Are you ready to buy a home? Here are some things to think about first.
Do you still have school debt? If you have debt from education loans, or personal loans and credit card debt, you may need to work on getting your “financial house” in order before you take on a mortgage too.
What does your credit score look like? If you don’t already know, get your credit report and make certain everything on there is correct.
Have you saved up enough for a downpayment? An FHA loan on a $200,000 house requires just 3.5% or $7000, but in addition to that downpayment, you’ll have closing costs, insurance, taxes and of course, you’ll need money for new furniture, paint and a few other upgrades. Consider saving up at least double what’s required for the home you want.
Consider the monthly costs. Your payment is just the beginning … if you’re moving from an apartment to a home, you’ll have sewer, water and trash bills, taxes, homeowners insurance, association dues and a little money to set aside each month for future repairs. In fact, your little repairs savings should equal at least as much as the deductible on your insurance.
So are you ready?