Taking the Plunge as a First Time Home Buyer
Before I ever owned a house I worked in real estate. There I had it beat into my head day in and day out by realtors that one wastes money by renting and that owning a home can be a life changing investment. Others insisted I was too young and that rent meant not having upkeep costs. I decided that I wanted to take the plunge so I worked toward the goal of owning my own home.
I took on overtime to pay off all of my debts to free up more income for house payments. I researched to find good mortgage providers like Capital One Home Loans. And then, when I was 24 I bought my first home. All by myself :) I have to say up to that point it was one of the things I was most proud of.
I went after home renovations with gusto changing this house that I had purchased that was hardly to my tastes with it’s 80’s country vibe into a home with the styles and tastes all my own.
Long gone were the dark and drab olive green walls and orange woodwork and in came my own style. Was I teased for having a lavender kitchen and dining room? You know it. But I was 24 and I had always wanted my very own purple kitchen! And since I owned it I could paint it however I darn well pleased (and did!)
And everything went really, really well for a while. I was happily updating my own and paying those mortgage payments and constantly so proud of myself that I was spending just a little more on a 3 bedroom house than I did on rent for a 1 bedroom apartment. And the house was MINE.
But I was working in real estate during a boom. In the time of milk and honey. Working in marketing I made a good living. I was content and I wanted for nothing. And then, like all booms, the bottom fell out and it busted.
First I was made part-time and I soon found myself dipping into savings to make up the difference in my new, smaller paycheck. But I stayed with my job because I kept getting told, you’re being full time again is right around the corner. But around that corner was a layoff. Not my full time job back.
I went from making good money, to making okay money and having a harder time making ends meet than I would have liked to depleting my savings and struggling to make my mortgage payments and having to decide which was more important, prescriptions or food. Though it was incredibly humbling, I did have to get help from family from time to time and it was almost harder because they so freely gave. But I had my own home and I had equity in it. And I had no worries of raising rent. My only stress was coming up with an exact amount every month and keeping my home. And I did it. And that’s why whether you’re 20 or 85 I think owning your own home is the way to go. It’s empowering and it’s such a huge comfort, even in hard times.
So let’s talk getting your own home… it’s pretty basic stuff but let’s lay it all out on the line anyway. Everybody’s got to learn something at some point, right?
- You need to find out how much home you can afford and I suggest comfortably. It’s recommended to take on a mortgage that is 2.5 times your current income rate. So if you make $30,000 you should buy a home around the $75,000 mark. There are online mortgage calculators to help you get a more in depth idea of what you’ll be looking at. And just so you know, if I hadn’t borrowed responsibly, I would never have been able to keep my home.
- Lenders are going to look at just about everything but your blood type! They’ll be looking at your income, assets, job history, credit score, total amount of debt you have and the amount of your down payment. It’s suggested to put 20% down to lower your monthly payments and avoid mortgage insurance.
- In addition to your down payment you’ll also need to have the funds for closing costs (to close your loan and transfer possession of the house to you).
- And last of all, take your time choosing a mortgage that is right for you. Depending on your budget, your down payment, the interest you’ll be paying and the length of your loan you can get different deals from different mortgages. They all have pros and cons but understanding where you’re at and what you need in advance will help you in the end with one of the biggest purchases of your life!
- And last but not least, you can get some awesome tools from Capital One Home Loans Online Neighborhood so check that out!
I was selected for this opportunity as a member of Clever Girls and the content and opinions expressed here are all my own.