Thinking it is time to purchase a home, but looking for some outside perspective in terms of where you need to be financially and in other respects? To help you take stock of where you are at, below are some signs that you might indeed be ready to take the leap into homeownership.
1. You have a stable stream of income.
The first and most important sign that you are ready to purchase a home of your own is that you have a reliable source of income and are on a stable career track.
Ideally, you should have at least two years of work history (the most recent two years before applying for a loan). These do not have to be at the same company and job title, but they need to demonstrate a consistent, logical career path.
2. You have clear plans for your future.
Before purchasing a home, you also should have a solid idea of what you want from your future. That means:
- You need to have an idea for how long you plan to stay in the area. Are you buying a home to stay in for just a few years, or are you shopping for a home for life?
- What are your plans in terms of family? Do you have children? Do you plan to have children?
Evaluating your plans will help you figure out the most suitable type of mortgage and interest rate, and also help you pick the right home.
3. Your credit score, debt-to-income ratio, and savings are in good shape.
Next, there is the matter of your financial metrics. Contrary to what many first-time homebuyers believe, you do not need perfect credit to purchase a home, nor do you necessarily need enough money to afford a large down payment.
But the better your credit score, debt-to-income ratio, and general financial standing are, the more affordable your home loan is likely to be.
As to having money in savings, that not only can help you to handle putting money down on a new home, but also can help you to qualify for a more competitive mortgage. This is especially true if you need a jumbo loan.
4. You know what you want in terms of a home and neighborhood.
Before shopping for a home, you should have a pretty clear idea in your head for what it is that you’re looking for in terms of the size and features of a house. You also should know what your ideal neighborhood looks like.
5. You are realistic about home costs, maintenance, and other responsibilities of homeownership.
Last but not least, you not only should you be in a position to afford the initial costs associated with purchasing a home, but you also must be prepared for the costs you will pay over the lifetime of your mortgage and beyond.
First-time homebuyers sometimes think of a mortgage as the entire cost of homeownership. But you will be responsible for maintenance, repairs, upgrades, homeowners’ association fees, taxes and more. If you’ve calculated ahead and know that you can budget these costs, you are in great shape.
Ready to Buy a Home in Arizona? We Can Help
If you think you are prepared to purchase a home, Barrett Financial Group can discuss different types of loans with you and go over your eligibility status. We can answer any questions you have about buying a home in Phoenix or elsewhere in Arizona, and can walk you through the application steps. To get started, please call (480) 470-1080 to schedule your consultation.