Ready to Own A Home? These Signs Will Indicate That You Are.
Buying a home will probably be the most important purchase of your life. If you are a first time home-buyer, it can be a daunting task, especially if you are not prepared.
Below are signs that indicate whether you are ready or not. You are ready if :
- 1) You know how much you can afford to pay towards your monthly mortgage. As a general guide, your monthly mortgage payment should be less than or equal to a percentage of your income, usually about a quarter of your gross monthly income.
- 2) You have enough to cover the down payment and closing costs. You have saved a percentage of the value of the property for the down payment – at least 20% for a conventional mortgage and less than 20% for a high-ratio mortgage.
- 3) You are familiar with the expenses associated with owning a home. Owning a home is not only about paying the monthly mortgage. There are other important expenses such as insurance, utility bills and maintenance costs.
- 4) Your credit is in good standing. Lenders will always look at your credit history – how much debt you owe, how many credit cards you have, the frequency of your payments, etc., and based on this information, they will either approve or reject your loan application.
- 5) You have been paying attention to the market. You must have a realistic view of what properties are out there and what you can afford.
- 6) You haven’t made any recent major purchases. For example, if you have just bought an expensive car, the amount you will be approved for may be lowered, making it difficult to get the home you want.
- 7) You have a reliable source of income. Buying a home is a long-term financial commitment, so you’ll need consistent cash flow to cover those monthly payments — not to mention the extra expenses that come with homeownership.
If you are in the market as a first time buyer, talk to one of our experienced Real Estate Advisors. We can guide you through all the important steps as you prepare to become your own landlord. Please call us on 604 913 1000, contact us or follow us on Facebook.