Make sure you have a solid emergency fund. Homeownership brings with it several expenses, other than just your mortgage payment. There is a lot of upkeep, and unfortunately if something breaks, it is up to you to fix it. It is important to have a rainy-day fund, because it is not a matter of if, but when something will happen that you will need to pay out-of-pocket for. Three months of expenses is a good goal.
Set yourself up with a good down payment. Aside from your emergency fund, the more down payment you can gather, the better. Ten percent is ideal, but twenty percent is better, since it will allow you to avoid private mortgage insurance payments.
Keep your budget conservative. Now that you have your financial ducks in a row, it’s time to set your home-shopping budget. A great rule of thumb is to keep your payments to no more than 25% of your take-home pay. Limiting your payment to 25% of your take-home pay means you’ll have money left in your budget for other goals like saving for retirement and your kids’ college — even paying off the mortgage early. And remember, your new home will have extra costs like yard maintenance, roof replacement or repair and upkeep for your heating and cooling system. It's good to have some wiggle room.
Be Patient. Now that it’s time to shop for homes, stay smart. It’s way too easy to blow off your budget if your emotions take over and you fall in love with a specific home or neighborhood.
Hire a quality real estate agent. Agents aren't for sellers only. A great real estate professional will help you find the right home and save you a lot of time. The best part is you won't have to pay anything out of pocket. Your purchasing agent will split the fee with the selling agent.
If you are thinking of buying a home in 2018, feel free to reach out to us today. We will connect you with an agent that will look out for your best interest.