You think you’re ready to buy a home? Home buying is a big financial step that needs to be thought of carefully before coming up with a final decision. It isn’t a minor purchase wherein you can just buy another if you’re not happy with your initial purchase. Home buying is a long time financial commitment, and you have to be ready for the consequences of this decision.
How do you know if you’re ready? While nothing is ever a guarantee, there are a few simple characteristics that qualified buyers share. Before you go home shopping, here are some question you have to ask yourself to make sure you are 100% ready to jump into the home buying wagon.
1. How do your finances look?
Be honest. You can never hide how you’re doing financially once you start the home buying process. As soon as you apply for a mortgage, everyone will be going through your finances to make sure you have the financial capability to purchase the house. Not only will they be looking at your current finances, they will also dig up your financial history. To avoid surprises, do your own financial research. Here are the things financial institutions look at when you want to buy a home: your income, employment history, debt, credit history and savings. If you don’t have a good credit score right now, it’s time to work towards improving your finances.
2. How much are you comfortable paying per month?
When you apply for a home loan, the lender will give you the maximum amount that they are comfortable lending to you. It might look attractive to you now because of its high buying power. But you have to remember that higher loans mean higher monthly payment. Look at your monthly spending and see how much mortgage payment you are comfortable paying each month. Consider future expenses and other changes as well.
3. Which location do you prefer?
Location has a big impact when it comes to home buying. not only does it affect the price of the property, it also affects your overall lifestyle. Do you want to buy a home in the country or do you want to live in the city? It’s important to have a solid idea of where you’d like to be before you start looking at listings. Each area has its pros and cons. City living is great for those looking to enjoy close proximity to shops and restaurants, but price tags tend to be high for comparatively little space. A house in the country will give you room to spread out, but you have to be okay with the idea of a long commute to work. The suburbs offer a middle ground, but your surroundings may be less unique.
4. What are you looking for in a home?
No home will ever be 100% perfect for you. At least not from the moment you sign the deed. Every property is going to come with a certain amount of compromise.When you sit down with a real estate agent, these factors will give them a good idea of where to start your search. Using these criteria, he or she will be able to weed through all of the available properties on the market and handpick the listings that work for you, which will save you both time and energy.
5. What do you want to do with the property?
Are you looking to buy a home to raise your family in? Do you want to buy it for investment? Or, do you intend for this home to be the place where you and your spouse grow old together?Knowing how you want to use the property will help to focus your eventual home search. If you’re looking for a property that will eventually serve as an investment, aim for a busier area that will appeal to lots of renters. Whereas, you’re aiming for a home that will grow old with you, stick to a size, layout, and location that you can see yourself being happy with for years to come.
Once you have answered all these questions, then you are ready to take the next step. Check out our step by step guide to buying a home.