Things that Show that You are Ready to Purchase a New House
Everyone dreams of owning a home at some point in their life. Remember that about 64% of people in the US own homes and you would like to join that list. Let us look at some of the things that will show that you are ready to invest in a new house.
First of all, you will stick around. I can say that it will be useless buying a new house when your family won’t live in it. Like if your lifestyle makes you move to different parts of the world it will be better to rent a house. Therefore, it is essential to know if you will stay or not before you buy a house.
Secondly, when you are a good credit score. One thing that you need to understand is that you will need a good credit score for the bank to approve your mortgage loan. You should know with a credit score of around 640 there are high odds that you will be approved for a mortgage loan. Apart from that, there is also a high chance that you will qualify for a loan if you have not missed more than a single payment within the past 12 months.
The next sign is when you have a steady job. After you have worked in a company for several years, you have probably saved enough to buy a house. One thing with most lenders is that they prefer to work with the people who have worked in the same company for at least two years. You find that this means that you will be able to pay your loan without missing a single payment.
Besides, when you have saved enough down payment. You should know that you will have to pay down payment unless you qualify for a no-down-payment mortgage. You should know that down payment is always higher as this lower the chances of defaulting. Because of that, it will be essential that you save enough amount that can manage to pay the down payment.
Apart from that, when you can afford the mortgage payment. One thing that you need to know is that your mortgage lender will use your debt to income ration to determine your ability to manage monthly payment and repay debt. When you have a low debt to income ration, will mean that you will be in a position to manage your debts. You should make sure that you keep the ration below 36 because anything above that you may not qualify.