Let’s set the stage. You are in your mid 20s. You’ve graduated college, been married a few years, and are thinking about packing up the apartment and making the big move. Having a house of your own sounds nice, but it’s going to take a lot of work! We realize that home buying may seem scary at first, so we’ve put together a millennial home buying guide for young couples and families getting ready to buy their first place.
Crunch the Numbers
The first step in purchasing a home is making sure that you are going to have enough to afford it. We recommend reviewing your finances and figuring out what your budget will allow. For those planning on taking out a loan, make sure that you are able to stay within the 28/36 rule in order to qualify. To stay in line with this, your mortgage payment, property taxes, and insurance should take no more than 28% of your gross monthly income. Add these numbers to your debt payments which should not equal more than 36% of that same monthly income. If you can stay within these thresholds, it should be safe to borrow to buy your home.
Prep the Papers
Paperwork is half the battle when buying a new home, so make sure everything’s in order. As you are making preparations and touring homes, have copies of your ID, credit report, employee verification, W-2, tax returns, and bank statements on hand. You will need all of these documents at different points of the process and it’s best to have them ready early.
Account for Taxes and Down Payments
Don’t forget that you are going to need to factor in insurances, taxes, and down payments into your budget. You may think that you are able to afford a house based on the monthly payment, but if you aren’t taking these numbers into account, you might quickly find yourself in debt. Keep track of all of those expenses to avoid unnecessary troubles.
As you are beginning to look at different homes, don’t settle. Tour and explore as many houses as possible and keep track of all of the things you like. Create a nice list of the amenities that you are looking for and find the house that you could picture yourself living in for a long time. It might take you a bit longer to decide on a home, but you’ll know for sure that this is the right house for you.
Location, Location, Location
Equally important to finding the right house is finding the right neighborhood. Spend a moment and picture everything you do in the average week. Would you be able to do all of these things in the neighborhood you are touring? Are there nearby schools for the kids? Can you find options for grocery shopping close by? Break out the map and make sure everything you need is within driving distance.
There is a lot to take into consideration when buying a new home, but we at J. Thomas Homes are there to help you every step of the way. For questions or help beginning your home buying process today, please feel free to reach out to us at any time!