Becoming a homeowner is a big step, but with careful planning, you can prepare yourself to be in a good position to buy your first home. To the uninitiated, buying a home can seem like a mysterious and complicated process, when really, it’s about knowing what needs to be in place to move forward. Here are five signs that you’re ready to buy a home.
You’re Prepared For Homeowner Responsibilities
Owning a home is much more than just paying a mortgage. Before you dive in, do a self check-in and make sure you’re ready to take on all the responsibilities of being a homeowner. This includes keeping up the yard, maintaining the property, making repairs, purchasing new appliances when needed, and contacting contractors. If a home is in need of attention, make sure you are ready to tackle remodeling projects and deal with any associated inconveniences. Lastly, check your finances and verify that you’ll be able to cover expenses associated with owning a home. Everything from calling a plumber to possibly paying a gardener – it’s all part of the fun of maintaining your new domain.
You’ve Done Your Homework
Before buying a home, do your research. There’s tons of great information available from credible online sources. Windermere agents provide many tips for first-time home buyers and specific tips for millennials as well. In addition, there are many credits and incentives for first-time home buyers. Read up and see if you qualify. Even more importantly, research your local market to get a sense of which homes are in your budget and if they meet your needs and at least some of your wants. This information is crucial in helping decide whether you are ready to buy a home in the neighborhood of your choice.
You Have a Good Credit Score
You don’t need a perfect credit score to qualify for a mortgage. But a good credit score often means more loan options and lower interest rates from lenders. Generally, it’s necessary to have a credit score of at least 620 to qualify for a conventional mortgage. It’s even better to have a credit score in the high 700s to ensure a low-interest rate. There are several loan options available with varying minimum credit scores, including VA loans. If you’re in the military and you want to buy a home, our agents love working with military families. They’re experienced and familiar with VA loans, and the associated credit score requirements. And, some of our real estate agents are veterans themselves.
You Have a Plan for Paying Off Debt
Before taking on the additional responsibility of having a mortgage, assess your debt. While lenders aren’t expecting first-time homebuyers to have zero debt, they are looking for you to have a payoff plan. Showing lenders that you are paying off debt will strengthen your buying credibility. It will also play a role when lenders assess your overall financial health during the pre-approval process.
You are Prepared for All Home Buying Costs
First-time homebuyers often think of purchasing a home in terms of saving enough for a down payment and mortgage. Having a 20-percent down payment means you won’t need to purchase private mortgage insurance (PMI) and leads to the best interest rates. But there are many other costs when buying a home including closing costs, moving expenses, plus appraisal and inspection fees. Additionally, property taxes may sometimes need to be paid as part of the mortgage depending on the time of year. After you move in, you’ll also need homeowners insurance. If you’re prepared to cover all these costs, then it’s a sign you are ready to buy a home.
Once the above 5 signs begin to align, connect with an experienced, local agent to learn more about buying your first home. They will know the local market very well. And, they’ll have excellent connections to local lenders, inspectors, repair services, and more – all of which will give you an advantage when you’re ready to find and purchase your first home.