There are many individuals out there who did not get bogged down by the mortgage bubble and are now thinking about buying a home. The question that should come to mind is whether or not this is a good time for you to buy? Jason Hartman and his team care about its readers, so it would not be prudent to say that everyone is ready to purchase a house. Waiting just a bit longer may benefit some readers, but how do you know if this includes you? We understand that saving for a down payment is a hard, so it’s understandable if you think you are ready. Here are a few hints to help you decide whether purchasing is the correct step.
Owning a home is not as easy as renting, and this is a fact that many eager investors forget. As a renter, you are not responsible for major malfunctions that occur in the house, whether it is a broken pipe or faulty wiring. These pesky problems are taken care of by the landlord and leave the renter simply kicking back to watch them work. As a home owner, all these pesky problems can start accumulating and become expensive. Preparing financially for when things go wrong involves creating and maintaining a safety account cushion for when the water heater breaks or the toilet needs to be replaced.
Another expense that renters needn't be concerned about is the homeowner’s tax, which, dependin
g on the area, can amount to a sizeable amount. Wanting to buy a house involves having a budget and keeping to it, making sure that the monthly income is more than the monthly expenses. To avoid financial stress, do not forget to include this tax amount in the budget.
Lastly, be sure that you have enough in your savings account for a sizeable down payment. Having less than 20 percent is sometimes acceptable with an , but traditional lenders often require as much as 25 percent. And don't forget the extra cost of mortgage insurance. This fee will remain until you have paid off 20% of the original loan so you might prefer to save for a few more months and avoid this fee entirely.
Renting is not a bad thing, but homeownership is the long term goal of many. It’s practically the American dream! Do not let the desire to own cause you react too quickly though. Interest rates are low right now and will most likely remain so into the near future. Doing proper research into all the fees and costs associated with owning a home is the smartest thing you can do. In the meantime, enjoy the hassle-free renting life. (Top image: Flickr | Images_of_Money)
The American Monetary Association Team