Think you’re ready to buy a house? Here are 4 signs
Many house buyers are still asking themselves this question, “Are we ready to buy a house”? Whether it’s the complicated buying process or the significant financial commitment tied to homeownership, it’s understandable the hesitation in pulling the trigger.
These are the four tell-tale signs that you’re ready for the homeownership plunge:
1. You’re ready to settle down
The 1st sign that you’re in the right position to become a homeowner is that you’re ready, at least for a while, to put down roots. Conventional wisdom states that you should plan on staying put for at least five years to make financial sense for your purchase.
You should ask yourself these questions when you’re finally considering buying a new house.
- Are you currently looking for opportunities, or do you see yourself staying at your job permanently?
- Would you be willing to move for if the right position came along?
- Do you like the area in which you live, or do you wish to search for other options?
- Do you see any change in your living situation soon?
- Are you planning to move in or expand your family with a significant other?
If you’re uncomfortable with any of these questions, you might want to consider renting for a little longer or thinking about a home for-a-few-years vs. an eternal house.
2. Your finances are stable
Let’s face it; To become a homeowner is expensive.
You will need to consider the monthly mortgage payments (which will probably be more than your current rent), but you will also need to take into account the funds you will need to make a down payment. There’s also the issue of paying for the closing costs as well as any repairs needed.
There are available online tools like mortgage calculators that you can guide you in determining how much house you can afford and can help you get an idea of what your monthly mortgage payment might be based on the down payment amounts, estimated interest rates and income.
You can start by setting the maximum amount you are willing to pay for a house, and then you can work to save a down payment. The amount of your down payment may vary depending on the kind of financing that you intend to use. If you are planning to buy your home with a Federal Housing Administration (FHA) loan, you’re usually only required to downgrade around 3.5%.
There’s no down payment requirement for those buying with VA loan (which is backed by the U.S. Department of Veterans Affairs). You should expect to reduce 10 percent -20 percent for most other conventional loans. Please note that if your down payment is less than 20 percent, some traditional lenders may require PMI or private mortgage insurance. Regardless of how you finance, the sooner you start, the sooner you are ready to go shopping for a home.
3. You’re ready for more responsibility
Yes, owning a house means you are free to do things like upgrading your kitchen or putting yourself in new hardwood floors; however, great responsibility comes with high renovating power. You are solely responsible for their maintenance and repair as a property owner
Are you willing to discuss the problems that arise in home maintenance? If you’re less handy, you might want to take some time to become familiar with common home maintenance tasks before you commit to buying anything.
Not yet thrilled with the prospect of being solely responsible for a house’ upkeep? Consider a shared living arrangement such as a co-op or condo where you may have the option to pay maintenance fees to take care of the maintenance rather than handle it yourself.
4. You know what you’re looking for
You don’t need to map out have every detail (in fact, in your home search, you should leave some room for flexibility), but it’s essential to get a general idea of what you’re looking for a house.
Think of your deal-breakers, of things without which you can’t live. These might include location, number of bedrooms and bathrooms, exterior features such as a backyard, or beautiful views. Pro tip: Once you know what your must-haves are, staying flexible on any other features, less critical, is a good idea.
What is the verdict, then? Do you think you are ready to buy your new house?
A good REALTOR® can aide you make the right offer for the property you’re interested in buying. For free valuation, contact us at 401-396-2888. We’re always glad to help!