Make the Dream of Homeownership a Reality in 2020
As Realtors we know that the majority of Americans, share a common goal: Owning a home: a piece of land, a roof over our heads, and a place where our families can grow and flourish.
If you're dreaming of buying a home this year we know that the best way to start the process is to connect with a Real Estate professional to understand what goes into buying a home. By having your questions answered and understanding the process you will put yourself in the position to make a smart informed decision. Below are some questions to help guide you
1. How Can I Better Understand the Process, and How Much Can I Afford?
The process of buying a home is not one to enter into lightly. You need to decide on key things like how long you plan on living in an area, school districts you prefer, what kind of commute works for you, and how much you can afford to spend.
Keep in mind, before you start the process to purchase a home, you’ll also need to apply for amortgage. Lenders will evaluate several factors connected to your financial track record, one of which is your credit history. They'll want to see how well you've been able to minimize past debts, so make sure you have been paying your student loans, credit cards, and car loans on time. The link above offers you a number of our personally vetted and trusted lending partners any of whom would be happy to speak with you and answer any of your questions.
Financial planners recommend limiting the amount you spend on housing to 25 percent of your monthly budget.
2. How Much Do I Need for a Down Payment?
In addition to knowing how much you can afford on a monthly mortgage payment, understanding how much you'll need for a down payment is another critical step. Thankfully, there are many different options and resources in the market to potentially reduce the amount you may think you need to put down up front.
If you're concerned about saving for a down payment, start small and be consistent. A little bit each month goes a long way. Jumpstart your savings by automatically adding a portion of your monthly paycheck into a separate savings account or house fund.AmericaSaves.org says,
Over time, these automatic deposits add up. For example, $50 a month accumulates to $600 a year and $3,000 after five years, plus interest that has compounded.
Before you know it, you will have enough for a down payment if you're disciplined and thoughtful about your process.
3. Saving Takes Time: Practice Living on a Budget
As tempting as it is to settle in each morning with a fancy cup of coffee from your favorite local shop, putting that daily spend toward your down payment will help accelerate your path to homeownership. It's the little things that count, so start trying to live on a slightly tighter budget if you aren't doing so already. A budget will allow you to save more for your down payment and help you pay down other debts to improve your credit score. Asurveyof Millennial spending shows,
70 percent of would-be first-time homebuyers will cut spending on spa days, shopping and going to the movies in exchange for purchasing a home within the next year.
While it's not necessary to cut all of the fun out of your current lifestyle, making smarter choices and limiting your spending in areas where you can slim down will go a long way towards building up your down payment.
If homeownership is on your dream list this year, take a good look at what you can prioritize to help you get there. Call, email or message any of us here at My NC Homes and let's get together today to discuss the best steps you can take to start the process.