The housing market is great and interest rates are staying relatively low so is it a good time to buy or should you wait? Here are five signs you’re probably ready to buy a house.
#1. You have saved an emergency fund.
If you’re living paycheck to paycheck and barely can make ends meet without an emergency fund set aside, it may not be the best time to purchase a house. Yes, you can buy a house with little to no money down but if something major happens you won’t have that additional emergency fund to make up any difference. Lenders like to see you as a low-risk borrower so if you have money in the bank for major repairs or if you lose your job, it makes you less risky.
#2. You have a good credit score and you don’t have many debts.
Get a copy of your credit history and report and go over it correcting any mistakes, and have a good handle on your credit score. Lenders like to see a credit score of at least 680 for the best interest rates and terms but even credit scores of 580 and maybe even lower can still obtain a home loan. But if you can, take 6 to 8 months and pay off credit cards, raise your credit score, and lower your debt to income ratio.
#3. You’re not going to make any large purchases right now.
Planning that trip to Europe? If you’re planning on buying a house, put that trip off until you are in your home for at least six months. Lenders like to see steady income, no big purchases, and exercising a commitment of responsibility.
#4. Get preapproved before looking at homes.
Sit down with a lender that you trust, either from your bank, credit union, or mortgage broker in your area and discuss your income, assets, debts and liabilities to find out how much you can actually afford when it comes to a monthly mortgage payment. Lenders will round that up into a price range, and then you can start looking at homes.
#5. You’re ready for more responsibility and long-term homeownership.
If you are renting a different home every year or two, homeownership may not be ready for you right now. If you’re ready to settle down for the next 5 to 7 years, homeownership might be a great option and you can start building equity, gaining assets, and set some roots down permanently for a while.
If you’re ready to buy a home on the Gulf Coast of Florida, give us a call. We have agents all up and down Florida’s Gulf Coast and would love to help you find the right lender, agent, and home for you and your family.
More Related Info:
The 4 Ways a Home Inspection Could Go – Beth Atalay
What you should know about dual agency – Dale Corpus