Homeownership is a common goal shared by many, and if you’ve been working towards making that dream a reality, it can be difficult to determine when the time is right. Some people realize that they might be better off waiting on buying a home, and some even come to the conclusion that homeownership just isn’t for them at all. If you’re seriously considering applying for a mortgage and taking the first steps towards buying a home, you’ll want to ask yourself the following questions first:
Why do I want to buy a home?
This is an important question to ask yourself, and can help you determine if you do, in fact, really want to buy a home, or just feel that it’s something you’re “supposed” to do. Common reasons that people purchase homes include control of the property, privacy and safety, more space, and that they feel they’re making a good investment. If you find it difficult to determine why it truly is that you want to buy a home rather than continue renting, you may want to hold off.
Can I afford it?
You’ve done the calculations and realized that for what you’re paying in rent, you could be paying for a larger home—and one that you’d own. Maybe the monthly mortgage loan payments would be even cheaper—but there is a lot more to budget for than your monthly loan payments. Buying a home is a huge purchase, even if you’re financing it. With a mortgage loan, you’ll still need a down payment (usually a minimum of 10 percent), in addition to closing costs. On top of your mortgage loan payments, there is homeowners insurance, property taxes, potential HOA fees, etc. You’ll also need to pay for your own home repairs and maintenance, unlike when you were renting. Make sure that you’re completely ready financially before you make any final decisions.
Am I ready to settle down?
You want to be confident that you’re ready to live somewhere for at least a few years—the longer, the better. If you still haven’t found a town or city that you can truly call home, if you wonder what else is out there, or you simply like changing it up and moving somewhat frequently, then buying a home might not be the right lifestyle choice for you. Once you’re confident about the type of home you want to live in and where you want to live—and can see yourself staying put for many years—then it might be time to purchase a home.