3 Things to Ask Yourself When Buying a Home in Your 20s
Being young is not always a hindrance to a person’s buying capabilities. If you are still in your 20s, but you are already financially capable of buying a residential property, there’s no reason not to. Simply make sure that you truly love the home you’re purchasing and that you are well informed about the decisions you’ll need to make. Here are some things you need to ask when buying a home at an early age:
How Much Can You Afford?
Your income determines how big the loan you’ll be getting is. However, you still have to consider your monthly expenses aside from the home. Simply because your income is high doesn’t mean you have to get the biggest loan for you. It’s better to be safe than sorry by having an estimate of how much of your income you can commit for monthly mortgage payments and other fees.
How Important is the Down Payment?
If you do your research, you’ll know that paying at least 20% down payment is ideal to get a better mortgage rate. Prmiloans.com noted that anything below that could make your monthly mortgage payment higher because of the additional interest rate. You have to be prepared for this down payment or else you need to rethink if you’re truly ready for a house purchase. Not to mention the extra costs — PMI fees, HOA fees, insurance, taxes, and maintenance — that come with it.
What Long-Term Plans Should You Consider?
Buying a house is a long-term commitment, so you must have long-term plans that match your purchase. If you’re planning to start a family in the next 10 years, you can’t buy only a single bedroom house. Your office location should also be approximate to the location of your house. Make sure to plan before buying a home. Imagine where you want to be five, 10, or 15 years from now.
Think things through first and if you’re still sure about it, then go purchase your home even if you’re still young.