Let’s be honest. Buying a house is NOT for everyone. There are a great number of people who shouldn’t be buying a house right now. It is imperative to know not only if you can, but if you should be purchasing a home.
Many people have home-ownership goals, and that is fantastic! But yet home-ownership doesn’t fit well with their current lifestyle.
Example 1: If you are a college student in a large city somewhere, you can only find a place to rent for $1100/month. But if you were to buy a condo your payment would only be $750 a month. This is understandably tempting, but if you only plan to live in that area for another 2-3 years before you sell it, you won’t be able to re-coop the closing and Realtor costs. This situation will more than likely just add expenses and headache. Someone in this situation probably shouldn’t be buying right now.
Example 2: You are single, have college debt, work for minimum wage, live with your parents, and have no savings. You would like to start feeling more like an adult and move out of the house but there isn’t a lot of affordable rentals. You find that you could purchase a small home for a monthly payment of $400. If you can get the financing, can afford the payments and plan to live in the area for a while, it isn’t the WORST idea. But first consider the possibility of staying with your parents longer and paying off the student debt. It will also allow you to be more mobile if a job that uses your degree is available in another town.
Example 3: You are planning on staying in the town for the foreseeable future, you live paycheck to paycheck paying $700/mo rent. You find a $40,000 house that fits your needs and you are pre-approved at the bank. The payment on this house will be around $300/mo so you should have plenty to spend on repairs and updates. Maybe even grow a healthy savings and upgrade to a bigger, nicer house someday.
Example 4: You have a steady well-paying job, good credit, and some savings. You know you want to live in the area for quite some time. And home-ownership is on your mind? Go for it!!
Home-ownership can be a wonderful, helpful, and important life changing decision. It can even be the key to financial stability. But only if it is done responsibly during the right time in your life. Otherwise, sadly, home-ownership can be burdensome, risky and end in foreclosure.
If you want to pursue home-ownership, please contact me. Angie Uttecht 605-350-2553 firstname.lastname@example.org