Owning a home brings a certain type of satisfaction that’s difficult to capture elsewhere. In fact, some people are so eager to own their home outright that they pay for it in cash.
But, not everyone knows the signs that they’re ready to buy a house. Not sure where to start? Don’t worry, we’ve got you covered.
Let’s take a look at everything you need to know to answer ‘am I ready to buy a house?’
1. YOU DON’T HAVE MUCH (OR ANY) DEBT
It can be overwhelming to consider purchasing a home if you’ve accrued a significant amount of debt over the years.
Things like car payments, student loan payments, and other financial burdens can hold you back when it comes to saving enough money to put down on your home. You may also worry that you might not have enough to comfortably pay your mortgage each month.
If you’re relatively free of debt, though, this is something to keep in mind if you’re on the fence about buying your first house, the extra cash will give you a lot more flexibility when shopping around fro your dream home.
2. YOUR JOB IS SECURE
A nightmare scenario for most homebuyers is losing their job shortly after they close and move into their new home. As you may expect, this could immediately result in financial trouble (especially if you can’t afford to carry much more debt).
But, if you’ve been at your current place of employment for a handful of years, or have a position that’s essential to your company, then it’s likely that you won’t run into any unforeseen employment issues.
Keep in mind, though, that the term ‘security’ here also involves having a consistent residence in the area. Some jobs, for example, are fairly volatile when it comes to how often you travel and how long you’re required to do so.
So, if you happen to have a job where you’re out of town for a week or two every month, you might not be ready to settle in one area just yet.
3. YOU HAVE PLENTY SAVED UP
The more money you have saved up, the larger of a down payment you can place on your home. This will directly translate into paying less interest on your mortgage financing, which will save you thousands of dollars in the future.
It’s commonly said that 20% of the home’s total value should be put forward as a down payment. But, you should always put down more if you can.
As previously mentioned, you could even buy your house all at once if you’ve managed to accrue enough in savings. But, financing is a far more convenient option for most people.
Getting pre-qualified is one of the most important steps while seeking financing for your home and can greatly speed up the process. So, keep that in mind after you’ve decided that you’re ready.
4. YOU HAVE ROOTS IN THE AREA
Your job is stable and you have plenty of money saved up. For most people, this is enough reason to settle down and buy a home. Others, though, need a bit more convincing.
Take a moment to think of what keeps you living in the area you do. If you’re involved in the community through volunteer work, have kids who attend a great school, or have developed long-lasting friendships, then you most likely have plenty of reasons to stay.
Sometimes, it can be tempting to leave problems behind and move to a new area entirely. It’s important, though, not to neglect the roots you have in your current location.
So, take being integrated in your town’s culture as a sign it’s time to plant your feet and stay.
5. YOU UNDERSTAND WHAT OWNING A HOME INVOLVES
Owning a home is far different than renting an apartment (or even renting another home).
While it may seem like common sense, many people are shocked when they discover they’re suddenly responsible for mowing their lawn, fixing leaky pipes, and otherwise maintaining their home in a way they’ve never had to before.
On top of all this, you’ll have to pay for the repairs and services yourself. For those who aren’t ready to incur unexpected costs, this could be financially straining.
In general, it’s recommended to save approximately 2% of your home’s value for repairs every year. Depending on the age and size of your home, though, this number could fluctuate.
6. YOU QUALIFY FOR FINANCING
Money is the single largest factor that holds potential homebuyers back. Whether it’s having too much debt or the inability to secure financing, it’s not hard for cash to be a problem. This is especially true for those who have less-than-stellar credit scores.
If you find that you’re able to qualify for financing, though, you could view this as a sign you’re ready to go through with purchasing a home. This is especially true if you’re able to finance your ‘dream home.’
Take some time to see what you can qualify for if you’re unsure about being ready to seriously consider buying a home.
ANSWERING ‘AM I READY TO BUY A HOUSE’ CAN SEEM DIFFICULT
But it doesn’t have to be.
With the above information about being ready in mind, you’ll be well on your way to making the decision that’s best for you and your family.
Want to learn more about the benefits of buying a home early? This article has plenty of useful info.