Ok so you’re tired of renting or leasing and you think you’re ready to take the plunge! But are you really ready or is buying your first home just a pipe dream right now. Here’s 5 key questions you should answer to help guide you in the right direction. Here in Northeast Georgia, owning that amazing cabin in the mountains or that traditional style home on a couple of acres is really wonderful however comes with challenges. These challenges are certainly worth it but being prepared is best the way to go. See the questions below & they’ll help you determine if you’re ready to be a homeowner.
1.Financial Preparation? Sometimes it’s easy to think you’re financially prepared but have you put the numbers down on paper & do you know how much owning a home actually costs? First of all on average you must have a minimum of 5-7% of the cost of the home which is great advice from Realtor.com. Also you must add 3-6% more for closing closts, which will vary based on where you live and what taxes are in your state and city. Also keep in mind that if you put down less than 20%, you’ll pay PMI, private mortgage insurance which is protection for the lender if the home goes into default. That can be anywhere from $50 to $200 per month. You should also know what your credit score is…Most borrowers will start to qualify for a mortgage with a minimum score of 620 but the most competitive rates will be offered to those will 700 or above. See Myths About Credit Scores.
2. Prepared to Make Compromises? Sometimes you can’t get the entire check list you want for your first home. It’s tough to make compromises but can be necessary. Ask yourself if you can compromise location or home features. You may be able to sacrifice square footage rather than location. It may be the yard size or proximity of neighbors. These factors add up to be the cost of the house. Be prepared to make compromises…rarely does your FIRST home have your check list.
3. Emotionally Ready? Here’s another that most don’t think about. It’s the emotional factor. Think about it in these terms…if the rent goes up, you move. If the AC goes on the fritz, you call the landlord & they send someone over. In your own home you are responsible for this. If you have an HOA (Home Owners Association) and they go up and then your property taxes are reassessed your mortgage can increase. There’s no way to know every increase that may happen
4.Will Owning Pay Off in the Long Run? This is pretty simple really…depending on the home you choose or where you live, you may pay lower mortgage than you paid for rent. But even if you don’t, there’s still the financial advantage of building equity into a home that’s yours instead of lining your landlord’s pockets. Make sense?
5. Has Your Lifestyle Outgrown Renting? Painting the kitchen, The desire to get a dog or cat, expanding the spare bedroom…all these generally aren’t permissable or very constricted when renting from someone. For example, what if I want to paint the wall lime green? Some rentals only allow for neutral colors or have restrictions that don’t allow your creative juices to flow. And expanding the spare bedroom…no way!?! You’ll have to take that DIY project down the road. If you’re itching to do these kinds of things…it may be time to find your first home.
As Realtors, we try to supply you with these kind of tips to help you along the way! If you’re looking to buy a home here in North Georgia, call us to begin your journey. We’re advocates of mountain living and we can help you every step of the way! Chad Lariscy | The Mountain Life Team | KW Realty Partners | 706-745-3123 or [email protected] MEET OUR TEAM!
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