When the New Year begins, we’re quick to establish a variety of goals for the coming year. For many, these goals involve losing weight, saving money, and completing educational experiences. For others, the new year is the perfect time to pursue the American dream of home ownership.
Such a significant purchase requires planning and thought. Many wonder if they’re ready for such a major investment before they finally pull the trigger. While it is a substantial investment, the fact that it is being questioned may well be the go-ahead—you’re ready.
Real estate guru Jason Hartman knows what a complicated decision home ownership can be at any age—here are a few tips to help you decide if it’s time to make your dream a reality!
Buying a home will be easier if you’ve got good credit. Before you embark on the journey toward home ownership, get your credit in line and know that you’re approaching sellers with a good understanding of your own credit.
While you may have excellent credit, you won’t get far without some money saved. Plan on putting around 20% of the cost of the home as a down payment, and remember that it’s got to be ready to go in one lump sum on the day you close. Also make sure that you’ve got the money to pay your mortgage and make any necessary improvements—these costs add up.
Shopping for a home is a lot of fun, but you’ll certainly have additional expenses once you’ve closed and moved in. Consider establishing a separate savings account for these types of expenses. Don’t forget about things like homeowners dues also.
Explore potential mortgage options you might have when you’re thinking about buying a home. More traditional financing options require high credit scores and larger down payments in exchange for better rates. FHA loans may reduce the down payment, but you could pay more in the long run.
Don’t forget to look into things like down payment assistance programs and first-time homebuyer initiatives. If you or a family member has served in the military, you may also be eligible for the USDA home loan program, which can cut costs.
Finally, make sure that you’re emotionally ready to purchase a home. Is this an area you would like to remain in for a while? How is the market in your state? If you decide to move, will you rent or sell the house?
Remember, the American dream comes in many forms—what’s yours?
The Young Wealth Team