5 Questions to Ask Yourself Before Buying Your First Home

Buying a home can be one of the best decisions you’ll ever make. Homeowners have the chance to build wealth as they pay off their home loans. Plus, a home offers stability and permanence. You’ll never have to worry about rent going up. But is now the right time for you to buy?

Here are the five biggest questions to ask yourself before buying your first home:

1. Am I Ready to Commit to Living in One Place for a Long Time?

Buying a home takes time. So does moving. When all is said and done, you want to be able to relax and enjoy your new home. Most people settle into their first home for at least three to five years. If you move sooner than this, you might not save much money compared to renting.

Are you ready to live in one place for this length of time? How would you feel if you ended up staying in the area for eight years or even longer? Check with others who will be living in the home, too. Everyone is affected by this decision.

2. Am I Financially Ready?

It’s best to spend no more than 30% of your take-home income on housing expenses. To make sure you can afford your home, start by making a budget. Then, talk with a variety of lenders who can offer you insight into how much you can borrow and what you’ll end up paying.

If you’re not sure if you’re financially ready, it may be best to wait. Spending some time paying off credit cards and other debts can help you qualify for better mortgage terms. You can get a lot done with your credit score in a year! Even a few points on your score can save money.

3. Am I Ready for the Responsibilities?

Even the worst landlords have certain responsibilities tenants don’t have to worry about. When you own a home, every repair comes from your own budget. Want funds to fix up your home? Setting a target to save 1% of the home’s purchase price each year will help.

Home maintenance is much less expensive when you do it yourself. Do you have time, interest, and the right skills? If not, can you save up enough to use professional help when you need it? When you look at a home, always consider what its maintenance needs will be.

4. Do I Understand the Process?

Getting a mortgage is complicated. Talking to a trusted resource can help. At Twin Cities Habitat for Humanity, our goal is to help people through the process. Our first-time homebuyer program helps you make informed decisions about buying, down payment assistance, and more at no cost.

Would-be homebuyers need to get their finances examined by lenders so they can get pre-approved. Loan pre-approval means you know exactly how much you can borrow. It ensures you can bid on the right home fast. You’re much more likely to get the home you want!

5. Am I In a Good Location?

Look around your neighborhood. Would you be happy to stay there? Does it have what you need, like shopping, dining, transportation, and healthcare? What about schools? Parks and trails? Think about how you’d like to spend your time. Would staying here help you thrive?

Spend plenty of time in a new neighborhood before you decide. Visit in the mornings, afternoons, and evenings. Drop by on weekends, during the week, and even on foot. When you’re happy with a place, connect with a local real estate agent. They can tell you how much homes are selling for right now.

Embarking on the journey of buying your first home is exhilarating. By asking yourself these important questions, you help ensure you haven't overlooked anything. Happy house hunting!