The decision to purchase your own home is exciting and sometimes overwhelming. When is the right time? Are you prepared to be a homeowner? These tips can help:
Set Your Budget – What can you afford? Being clear and honest with yourself about your budget helps you set realistic expectations and begin immediately searching for your new home. Typically speaking, buyers can afford homes equal in value to between two and three times their gross income.
Develop Your Wish List – Make a list of everything you want your new home to include. Examples are the number of bedrooms and bathrooms, the square footage, and the types of countertops and flooring. Then, prioritize your list. What is most important to you?
Pick Your Neighborhood – The aesthetics of your home are pretty darn important, but where your home is located plays a huge role in your lifestyle. Identify three or four neighborhoods where you would like to live. You will want to take into account things such as the quality of the school districts, local recreational facilities, the area’s future expansion plans and the neighborhood’s safety.
Set a Budget and Start Saving – If you have already started saving, great work. Keep it up. If you haven’t, set a clear budget for yourself, factoring in a monthly chunk of money to use towards your down payment and closing costs.
Review Your Mortgage Qualifications – Get your credit report in order. Make sure it is accurate and error free. Then, determine how large a mortgage you qualify for and get pre-approved.
Calculate the Cost of Homeownership – While home ownership is a great and wonderful thing, there are costs associated with it that aren’t associated with renting. These include, but are not limited to, property taxes, maintenance and utility fees, association fees (if applicable), and homeowner’s insurance.