There are many reasons some rent besides not be able to obtain a mortgage. College students are among those that rent over buying. Here are six signs that its time to turn from renting to buying a home.
You have enough for a down payment plus extra
Anyone who has purchased a home can tell you that it is a big expense. Expenseses start from the get go. The first big chunk of change you will need is for the down payment. The average down payment is 20% to 25% of the purchase price. If this is not an option, try and get qualified for a mortgage that only requires a 10% down payment. There are also government sponsored loans such as FHA loans that only require a small down payment such as 3.5% of the purchase price.
If you have a good amount saved that will cover a down payment plus a little left over, you are ready to purchase instead of renting. What do those in the industry suggests? You have several months or years worth of cash reserves saved up ontop of your down payment. A lender loves to see a little cushion for a rainy day.
You feel secure in your career
If you have steady employment, then you are ready to buy a home. Mortgage underwriters want to see stable employment from those applying for a home mortgage. If you have worked for the same company for at least two years, you have a great leg up when it comes to qualifying for a mortgage.
You are able to get a buyer commission rebate
Luckily this day in age, you do not have to use all your hard-earned savings to buy a home. There are many new ways to purchase a home without using all your savings. A homebuyer’s commission rebate is one way. A homebuyer will get a cash rebate up to 2% of the purchase price.
Your credit score is in good standing
This is a big part of the home buying process. Your credit score reflects how well you pay off the debts you accrue. So paying your monthly car payments starts to put you in a good spot. Remember to pay your monthly credit card bills on time and do not accumulate large balances. You can check your credit score through Experian, Equifax or TransUnion.
You want to lock in a good mortgage rate
Remember renting just lines the pocket of your landlord, but paying a mortgage each month builds equity. Interest rates are still at historical lows but they are starting to rise. Renters should go ahead and lock in a rate now.
You found your dream neighborhood
If you feel you have found your dream home, then it might be time for you to stop renting and purchase that dream home. Remember call a local Realtor who can help you through the process.
