We never tire of saying what a great time this is for buying a home. With mortgage rates still very low, plus other incentives such as low down payment home loans, it makes total sense to get on the housing ladder right now, before something changes.
In reality, of course, and for a wide range of reasons, you simply may not be completely ready to take the big step and are now targeting the New Year for your first foray into home ownership.
The good news is that there are things you can start to do now that will help you to achieve the very best outcome when the time is right for you to buy a home in 2016:
Make sure your credit is in great shape - Unless you are one of the very few first time cash buyers, you will need to obtain a mortgage to finance the first home of your own. When the time comes to start looking for your ideal house, it is most important to firstly be pre-approved for a home loan. This ensures that you will know exactly what you can afford and it also means that sellers will take your offer very seriously, safe in the knowledge that you actually are capable of purchasing their property. One of the key factors borrowers use in assessing your ability to obtain a mortgage is your credit rating and this requires very careful management and attention right now, even if you're not planning to buy a home until very late 2016. Paying your bills in a timely fashion, resisting the temptation to rack up a huge credit card balance over the holidays, avoiding big purchases (especially taking out a car loan) are all good disciplines you should already be following. Debt to income ratio is an absolutely crucial element in assessing your situation, so make sure that you have your living expenses well under control in comparison to your actual income. This may mean that you have to exercise economies, perhaps cutting out an expensive cable or satellite TV contract or not going away on a winter sports vacation, but the sacrifices will be worth it when your loan officer collates all the details of your finances, in order that you can be assessed for pre-approval. This is most definitely a time in your life when saving, rather than spending, should be at the very summit of your priority list.
Keep in touch with your credit rating - It's a great idea to register with one of the credit reporting sites to stay in touch with your credit rating. This will enable you to monitor how you're doing and, indeed, be able to see the results of clearing some or all of your debts.
Never too early to speak with a mortgage professional - It's a really smart idea to connect with a loan officer, even if you aren't ready to buy just yet. This will facilitate a complete look at your finances and provide you with some specific pointers as to how to be in the best financial shape you can be in when the time comes to be pre-approved.
Know what you're looking for - Make sure you spend time deciding on the location in which you'd like to live and what sort of home and features you'll need. This means that when you eventually brief your realtor on your requirements, you'll be doing so having made some thorough research and will be given a far more focused selection of homes to look at. Affordability is a big factor here, of course, so looking at real estate website, such as this one, will give you a great idea of the rough asking price of the sort of home you'd like currently is, so you can see if it's a realistic goal or not. Remember that generic home pricing websites can give prices that are somewhat wide of the mark in terms of real-world accuracy.
Think ahead - Another good policy when defining the ideal home for you to own is to look ahead to what might change in the forseeable future. The most important question is usually if you're either planning to start or increase the size of your family. It can be expensive to buy a home that's perfect for two, but a tight squeeze when the kids start arriving.
We hope this gives you some idea of the sort of mindset that you should be adopting right now to ensure that in 2016 you'll be in that home you've dreamt of. Call us today for more specific advice relevant to your individual situation.