If you have started thinking about buying a home, you might not know whether or not you are really ready for what is probably going to be the biggest purchase you will ever make. Right now is a great time to buy a house. You can find great rates on mortgages, there are lots of homes available across the country, and there are solutions and incentives available for first time buyers. But is right now the right time to buy for you?
Have you saved enough money?
Buying a home without a cushion of savings to fall back on is never a good idea. In order to determine whether or not you have saved enough, you will need to make sure that you have money in the bank not just to cover your down payment, but also to cover a few months of house payments and other expenses. Having enough money saved can ensure that even if you lose your job or are injured and cannot work, you have some time to recover, without the possibility of losing your home.
How much do you realistically need to save? While there are no or very low down payment options available for most mortgages, it is important to keep in mind that the higher your down payment is, the better terms you will have on that mortgage and the better rate you are likely to get on your mortgage insurance.
Is a home purchase right for your life right now?
The biggest factor that is going to play into whether or not you should buy a house is your current life situation. If you want to continue to move around a lot, buying a home is probably not a good idea. If you have found somewhere you want to settle down, buying a house is probably actually the better option, as it prevents you from continuing to pour money into the endless hole that is paying rent.
It is important to keep in mind, however, that on top of monthly mortgage and insurance payments, you’ll also have to maintain that home. Are you in a place in your life right now where you can devote the necessary time and energy to maintaining your home that the average house needs?