Buying a home is not a decision that can be made overnight. You need to prepare yourself for buying a home, and make sure that you follow some certain guidelines so that your home purchase can go smoothly. This takes a certain amount of preparation and can take some time. You should give yourself a year or two from the time you start thinking about buying a home to the time you are actually going to buy one.
1.Â Â Â Â Stop making major purchases. You donâ€™t want to run up credit card bills or personal loans to make major purchases. This only adds to the amount of debt you have to repay, and you donâ€™t want to be paying on those major purchases when you have to start making a mortgage payment. Buying a home requires some tight budgeting.
2.Â Â Â Â Have a stable job. If you donâ€™t like where you are at and you are thinking about changing jobs, do it now before you start really getting to the point where you want to buy a house. You have to have financial stability to qualify for a mortgage, and to make the mortgage payments. You donâ€™t want to be changing jobs just before or after you buy a home.
3.Â Â Â Â Check your credit report as soon as you start considering home ownership. Look for errors that need to be corrected, accounts that you need to get into good standing, and other ways to improve your credit score.
4.Â Â Â Â Save for a down payment and closing costs. Closing costs can be a couple thousand dollars, and a down payment is usually about five percent of the purchase price of the home. This is several thousand dollars that you need to come up with before you should even be looking at houses. It takes most people two years to save up enough money for a down payment and closing costs.
5.Â Â Â Â Do your research about where you want to look for houses. Donâ€™t just assume you want to find a house in a particular city. Look carefully into the different neighborhoods. Check out the school system, even if you donâ€™t yet have children. This is a long term investment and you donâ€™t want to be sorry you made it later. You should also check crime rates for the zip code you are considering. You can do most of this research online, but visiting the neighborhood and talking to people who live there is also extremely helpful.
Overall, there are a lot of things you need to do to make sure that you have a good solid foundation for buying a home. Planning ahead is extremely important. Do not rush into something that will get you in over your head, but rather take your time and be responsible.Â