Buying a house is a key component of the American dream.
Rather than throwing your money away on rent, you can be spending that money to
steadily acquire and build equity in an asset. However, for those who are
unprepared to buy house, home ownership
can be a nightmare. Here is a guide to help you know if you are really ready to
buy a house.
Financially Ready
Obviously one of the most important ways to be ready to buy
a home is to simply be able to afford it. However, the mortgage is not the only
thing you need to consider when developing your budget. Keep in mind you may
also have the extra cost of home owner’s association fees and home owner’s
insurance, taxes, and a separate account for future repairs and remodeling.
Keep in Mind also that if you are moving into a bigger
space, your utilities and other expenses will likely go up. If you are buying a
home with a yard you will also have to shell out money for lawn care expenses.
Finally, being financially ready means having a down payment
saved up. Most mortgage lenders require a down payment of twenty percent of the
cost of the home. However there are some programs for new home buyers,
particularly those in civil service jobs, that allow homeowners to put down as
low as 3.5% of the purchase price.
Emotionally Ready
While being financially ready is fairly easy to quantify,
being emotionally ready is far from it. Buying a home is an emotionally trying
process. It can be easy to stress out over whether or not your offer will be
accepted, or if you end up buying a home with unforeseen problems.
Luckily, you can avoid some of these risks by getting an
inspection from a professional real estate inspector. He or she will point out
any issues in the plumbing, foundation, or electrical wiring that you would not
have known about.
