Can (And Should) I Buy a House Now?

by Chloe Muller on April 24, 2021

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Buying a house is not like buying a new pair of shoes, or a new computer, or even a new car, for that matter. Successfully buying a house means you have chosen and achieved the right combination of circumstances, personally, geographically and financially. This also means you have taken your time to be sure you meet several main criteria of successful first time home owners.

Remember, buying a house commits you not only to a certain location for a very long time; it also commits you to a financial plan (a mortgage) for that same amount of time, if not longer. Buying a house is often a labor of love, since as the owner, you are responsible for all the caretaking of the building and the property surrounding it. If anything goes wrong, or needs improvement, this must also be factored into the cost.

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Despite these warnings, buying a home can be a thrilling and enriching experience, particularly if it is your first home. The experience will improve the better you have prepared for it.

Here are the things you ought to check for when looking to buy a house:

1. Be sure you are willing, able and content (I’d say ecstatic would be even better) to stay put in the place your potential house stands for no less than 5 years.

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2. Have good credit. Check your credit score, and if it isn’t where you’d like it to be, do what you need to do to improve it (pay off credit cards, transfer balances, pay off loans) before you try to buy a home. You will not get very good interest rates on your mortgage with a low credit score. In some cases, you won’t even get any financing toward a home with bad credit, so always check first.

3. Set a realistic goal for the home of your dreams. This means you have to honest about what you can afford, so before you even start looking, determine what that figure is, based upon your current salary. The conservative rule is 2.5 times your household earnings.  Do not try to purchase something out of MTV Cribs that you will never possibly be able to pay off (read: own.)

4. Get a lender to pre-approve you for a loan, before you even start to shop. It helps to at least know that you would be pre-approved, for the time when you actually start to shop for houses and loans.  By getting pre-approval, you will know how much you can borrow for a home and therefore will narrow your home searches down.

5. This may seem obvious, but our dreams and financing possibilities tend to get ahead of us sometimes: Save up enough for a down payment of at least 20% toward the purchase of your home, as well as enough actual cash to pay for additional fees for closing costs.  Normally, closing costs for a purchase of a home will be anywhere from 2 to 4 percent of the purchase price of the home.

If you can’t honestly say that you meet the majority of these criteria right now, then the time is not right for you to buy a home. Don’t forget the upkeep of the home after you’ve bought it either, not to mention any new appliances or furniture you’d need to get started.  If you do not meet these criteria, you might want to start meeting them soon as it is a great market for prospective homebuyers right now.

I hate to see anyone get in debt to any sort of lender, over their head. If you don’t meet the criteria for buying a home right now, be patient, work hard to meet all 5 (might as well start at 100%), and then you can be assured you are in a much better position for buying a home.

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