If you’ve been a long time renter, chances are at some point you may have said to yourself, “I wish I had a house.” Before you head into your bank or start talking to a local real estate broker, you must first understand that besides costs there are a wide variety of responsibilities associated to owning a home. It is always better to sit down and take a serious evaluation of your situation before signing a contract on a home you may not be able to handle in the long run.
The most obvious factor in becoming a home owner is affordability and costs. Unless you have large amounts of cash just sitting around, you will need to take out a load from a bank to obtain a mortgage which also means seriously evaluating your credit score. If you have a credit score of 650 or less, then it is recommended that you work on building up your credit unless you want to pay extremely high loan interest rates. You can still purchase a house with a low credit score, just be prepared to for great risks.
Along with your costs, your job situation is another important factor that must be considered when thinking about purchasing a home. On top of ensuring that you have enough funds to pay your mortgage, there are also other costs to owning a home. These include upkeep and maintenance, utilities, property taxes, insurance and service costs, just to name a few.
The final step in deciding whether you can afford to buy a house is to actually sit down with a pen and paper and write out a budget. For example, if currently you rent an apartment for $2,000 per month why would you decide to buy the same dwelling for $6,000 dollars a month? If you do the math to own the same home you would be renting would end up costing you $48,000 dollars more a year.
All these things have to be looked at closely to see if you really want to take the plunge from renting to buying a home. Team Carstensen can help you realize your dream of becoming a home owner. Contact us today or use a real estate calculator.