Is home ownership the American dream that everyone cracks it up to be? The age old pay yourself instead of paying your landlord is certainly true but how do you know you are actually ready for the demands that come with home ownership? There are multiple factors to consider before taking the plunge, here are just a few.
1. Low Credit Score
One of the biggest expenses that will come from owning your own home is the interest expense. You will want to ensure that you secure the lowest interest rate possible. The best course of action is to check your credit score before ever prequalifying for a mortgage. A small difference in credit scores can translate to thousands of dollars more in interest paid on a home.
2. Job Stability or Relocation
Home ownership is a long term commitment. If you aren’t certain that you want to be in a particular location for a long time, that might be the first sign that you are not ready for home ownership. Additionally, there are other factors to consider such as how secure your job is, or even if there is a potential for you to be relocated in your job.
3. Maintenance fund
Cash is king when it comes to owning your home. The number of things that can go wrong in a house, even if it’s new, is astounding. You will want to make sure that you have enough cash socked away in the event of an emergency or other routine maintenance that is sure to pop up. It is said that you should have at least 5% of the value of your home saved for maintenance and emergencies.
Among the many factors that go into home ownership, these are some of the most important. If you still think you are ready after reading these, you may be a good candidate after all. The most important thing to remember is to do your due diligence and make sure you are walking away with the absolute best investment for your needs. It is hard not to rush decisions such as these, especially when you have invested so much time into the process. There are always houses out there to discover on sites such as Mitula, so never make a final decision to buy a home if it doesn’t feel absolutely right. However, careful planning and preparation will ensure that you will land the house of your dreams.