Owning a home is a huge decision. It should be something that you consider and talk over before jumping in. Have a talk with yourself or your spouse before pulling the trigger. This talk will ensure you are both ready and have shared ideas about this big-money move. The three questions to ask before getting a mortgage cover budget, timing, and what owning a home means to each person. Once these three questions have been answered, then it’s time to start looking for a mortgage lender.
How much monthly payment would you be willing to pay? Consider your current housing costs that you may be paying for rent. There may be some wiggle room here if the move means you are saving on other expenses. Say, for example, your new home is closer to work, and you will save on gas or transit costs.
Consider how much extra funds you are willing to spend for upgrades, maintenance, and homeowners insurance. A resale home comes with the risk of having large mechanical items near their end of life. A water heater or air conditioning unit may need attention or replacement soon after you move in. Keep this in mind when thinking about budget. If you buy a new construction home, you may not have to visit these costs for many years. A new construction home usually comes with at least a one-year warranty on the home itself while most of the appliances will also be under a warranty period also.
There are great opportunities to start the home mortgage loan process, regardless of the market or the time of year. Timing is more about what is best for you. Moving in summer is ideal for families with kids, but buying in winter can net pricing in the buyers’ favor or less buying competition. We recommend buying when the time is best for you. Don’t try to time the market or chase interest rates. You can always refinance down the road. But your quality of life and what will really work well for you should dictate if you buy and when.
Your credit score and financial picture, tax benefits, property appreciation, and accumulating equity should be weighed. Zoom out from the monthly payment and daily budgeting perspective and contemplate the long view. Owning real estate can be a cornerstone to wealth and your nest egg. Owning a home can have cascading effects on your family in terms of being prepared for college costs, the lifelong impacts of a family home, and the investment you are making to be a part of a community.
After you have “the talk” with your partner (or yourself!) where you set your budget and priorities, you should then take a look at the next steps. Review our Home Buying Guide to learn about the simple steps it takes to become a homeowner.
If you aren’t sure about your readiness, you can tap into advice from a professional mortgage loan officer. A good mortgage lender can help you make the right decision based on what is best for your individual situation.
Nathan Mortgage is an independent mortgage broker, which means we are not commission-driven. You can feel at ease reaching out for a free consult. The loan officers at Nathan Mortgage seek to be informative guides and your strongest advocate.
Does owning makes sense for you financially given your budget, timeline, and goals?