Making The Move Into Homeownership – 5 Financial Signs You’re Ready To Buy

Transitions happen naturally in life. At some point, after some time renting, the progression into buying your first Knoxville home comes naturally.  Maybe you’re sick of having a landlord, looking for more space, or are sick of throwing money away, whatever the case you’ve got the urge to buy your first home.

Making the move into homeownership isn’t always easy, it comes with some planning and some financial stability. If you’re thinking about buying your first Knoxville home, here are 5 financial signs you’re ready.

Credit Score

A credit score is important when it comes to buying your first Knoxville home. Your ability to buy a home is based largely on whether or not you have good credit or not. Prior starting your home search, it’s important to have an idea of where you credit stands.

A good credit score will make it easy for you to get approved for a loan while a lower credit score could make things more difficult. Prior to starting your home search, talk with a loan officer to see where you credit score lies.

Down Payment

Depending on your situation, you may be required to have a down payment when you buy your first Knoxville home.

There are some loan programs that allow you to get into a home with no money down, if you meet certain income requirements. USDA loans, THDA grants, and VA loans are just among a few of the options that may allow you to get into a Knoxville home with no money down.

Saving up for a down payment can sometimes be one of the most challenging aspects for many first time home buyers. If you’re thinking about buying a home, you may want to start saving for your first Knoxville home in advance. It’s not as hard as you may think to save up for a down payment, little things like cutting meals out and cutting down on unnecessary extras are all things can add up quickly.

Maintenance

Home maintenance is often an often an underestimated aspect of buying your first home.

Even if you have a home inspected, things can still go wrong in your home in the first year that you live there. As a first time buyer, it’s important that you have money stashed away on the off chance something goes wrong. Home maintenance can be unexpected and expensive if you don’t have a rainy day fund.

As a first time buyer, you may want to consider getting a home warranty when you buy your first home. A home warranty can be paid for by the seller at closing. Or, you can purchase it separately after closing on the home. A home warranty can be a worthy investment for homeowner’s who want to be prepared for the unexpected. With a home warranty, on covered items, you’ll just be responsible for paying for the service call fee, which is typically $75 to $100, instead of paying for the whole issue to be repaired.

Just be sure when purchasing a home warranty, you understand what items are covered and what items are not covered.

Income

Income is also important to buying your first home.

You’ll need to show that you have financial stability to be able to pay a mortgage. A lender will want to see that you have job stability and that your income is regular enough to pay a mortgage.

If your income is based off of commission or bonuses, you’ll likely be required to show at least two years worth of income to be approved for a mortgage.

Investment

When you’re ready to buy your first Knoxville home, you’re ready to put your money towards an investment. Instead of paying rent each month, when you pay your mortgage it goes towards an investment. Each month you pay money towards building equity in your home.

When you’re thinking about buying a home, you’ll be ready to make the financial investment in owning your own home. You’ll be ready to settle into a place to call your own and be ready to be financially tied to a home.

Are you thinking about buying your first Knoxville home? Please let us know if there is anyway that Knoxville Home Team can assist you in your home search. You can contact Rick at 865-696-9002 or via email at Rick@KnoxvilleHomeTeam.Com. Or, you can contact Kati at 865-392-5880 or via email at Kati@KnoxvilleHomeTeam.Com.