Owning a house has become cheaper than renting in twelve major cities, including Orlando, Miami, Chicago and Atlanta, now that interest rates are floating around the 4% mark on a 30-year fixed mortgage.
“Home prices and mortgage rates have fallen so far that the monthly cost of owning a home is more affordable than at any point in the past fifteen years and is less expensive than renting in a growing number of cities,” states the Wall Street Journal.
Should you include owning a home in your spending plan for the near future? Here are the questions we asked ourselves when we made that decision late last year
My Top 3 Questions to Discovering if Home Ownership is for You
- How much can you afford?
How much house can you afford? Use Calendar Budget’s online budget manager to assess your earnings, investments and liabilities to work out how much you can spend on your new home. You should also go to your bank to get pre-qualified for a mortgage loan early in the process. Several factors, including the funds you have available for the down payment, closing costs and cash reserves required by the lender, your gross income, credit history, debt, the kind of mortgage you choose and current interest rates will affect the price you can afford to pay for a house.
- Can I cover the expenses involved with buying a house?
Here’s another reason to use a budget planner when buying a home: there are many costs involved (besides the down payment). For example, if you would like to know the actual worth of the home you’re buying, you’ll need a valuation. And to ensure that nothing is terribly wrong with your potential home, you’ll need insect/termite, building and swimming pool inspections. You’ll also need to factor in legal fees, agent’s fee, moving costs, insurance and utility connection fees.
- What is my credit score?
Be sure to get your credit score before starting your house hunting process. Get a printout of the report and check it thoroughly, and have any inconsistencies that are on it rectified. You don’t want to be refused a mortgage, and you want to get the best rate possible, so it’s essential to do some budgeting at home to ensure your credit looks fantastic before you start looking for a house.
If, in your financial budgeting, you’re trying to stand firm and stick to the spending plan devised by your budgeting software programs, you just have to take a look at the low mortgage rates and enticing home prices to see that now is the time to purchase.
Do you have any ideas on when is the best time to purchase a home? Please leave a comment so we can know your thoughts.