Maybe you've been thinking about buying a home for several years now but you've put off your plans because you're waiting for the right time. So how do you know when the right time is? How do you decide that it's time to buy a house?
Buying a home is a big step that you and your family must prepare for. It's not something that you decide on based on a whim. Buying a house without proper preparation will most probably end in foreclosure. So to avoid wasting time, money and resources, figure out the best time to buy a home and plan ahead.
These are the factors that could influence your decision to buy.
1. Stability. If you plan to stay and put down roots in a specific neighborhood, then it might be better to buy a home than rent.
2. Space. Is your apartment or condominium getting smaller for your family? Do you need more space for you and your kids?
3. Family changes. Is your son getting married and planning to stay with you? Are you having a new baby in the family? Having an additional member to the family means you need a bigger home.
4. Need for change. Senior citizens usually downsize because their children are already married and are living somewhere else.
5. Place for your pet. Not all living spaces are pet friendly. So if you want to take care of a dog or a cat, consider buying your own place with a big backyard for a dog or trees for your cat to climb.
6. Upgrade and personalize. We all know that living in a rented apartment or house doesn't give you much freedom for renovations. Also, you can't personalize your living space because you think it's not yours anyway. When you buy your own house, you can decorate it anyway you want to.
7. Better access. We all want to live near shops, restaurants, public transportation, hospitals, schools, etc.
Once you've decided it's time to buy your own home, analyze your financial situation and start planning. Here are some of the financial factors you have to consider:
1. Work history. Is your work stable? Do you have any plans of changing career or applying for another job? Bear in mind that lenders prefer borrowers with a steady work history.
2. Steady cashflow. You need to have steady income coming in to be able to pay your monthly mortgage.
3. Good credit score. Do you have unpaid bills or unpaid loans? Having a good credit score improves your chances of getting better interest rates.
4. Downpayment. The usual downpayment is 20% but more lenders are accepting lower downpayments these days.
5. Overall debt. What is your debt to income ratio? Find out what your financial liabilities are and pay them off before applying for a mortgage. This helps increase your credit score, and makes it easier to pay the mortgage because you don't have to worry about other debts.
Remember that buying a home is a long term commitment. You have to be prepared financially, emotionally and psychologically.
Comments (0)Subscribe to CommentsComment