There comes a time when you will ask yourself, “When will I buy a house?”
When you move out of your parents’ home, you will rent an apartment for yourself or rent a house with your friends. But as you grow older and get further along with your career, you start looking for more stability. This often means finding a place that is truly your own. But just because you want to buy a house doesn’t mean you’re ready to make that purchase.
Before you look at listings and visit open houses, consider the situation. Some signs can indicate your readiness to buy a house. Find out more about them to determine if you are ready for this next step.
You have money to buy a house.
The first sign that you’re ready to buy a house is that you have the money to do so. A home, no matter its size, is a costly expense. If you barely have the money to spend on hobbies and luxuries, you might not be in the right financial situation to make such a big purchase.
Check your finances to determine the feasibility of this decision. Aside from having enough money to make the down payment, you should have some leftover for furniture, appliances, repairs, and renovations. Your budget should also be able to adjust to the new expenses, such as home insurance.
You don’t have any debt.
The second sign is that you don’t have any large debts. When you apply for a mortgage loan, the lender will look at your annual income and credit history. When they discover your debts, your application might be rejected.
Try to get your debts under control before considering this purchase. Consider making some changes to your spending habits to fast track this process. You don’t want to have any obligations hanging over your head as you move into your first home.
You have a stable job.
The third sign is that you are comfortable and stable in your profession. A house is a significant expense, and an unstable source of income can cause serious problems. If you are currently paid on a commission basis, you might not have the financial stability for a house.
Consider purchasing a house after you have spent at least two years at your job. This is typically enough time to establish income stability. Additionally, this is the minimum amount of time most banks look at when reviewing loan applications.
You know you want to stay.
The fourth sign that determines if you’re ready to buy a house is that you are prepared to stay in the area for a long time. If you are planning to move to a different city, state, or country in the next five years, then being a homeowner might not be for you just yet.
Before making this financial decision, determine how long you plan on living in the area. Look at possible homes once you’ve decided that this is where you want to live for the long-term.
