*Note: This was written by a Yahoo! contributor. Do you have a real estate story that you’d like to share? Sign up with the Yahoo! Contributor Network to start publishing your own finance articles.
We sold our house in Tucson, Arizona a year ago and moved to be closer to our children in Los Angeles. We found a great apartment and have been happy here, while occasionally looking at houses and condos. The process reminds me of when I bought my first house, after leaving active duty with the Navy.
I’ve always been a careful saver and made sure I had everything ready financially before I took that big step. Here are the key things that let me know it was time to buy my first house:
No debt
Before I bought my first house, I paid off all my debts. To me, this was the most important thing and when my family members or friends ask me about buying their first house, this is what I tell them all. It delayed my purchase by about a year, but having no debts other than my mortgage really took a lot of the pressure off me.
One-year emergency fund
Before buying my first house, I made sure I had a one year emergency fund, in cash, in the bank. This was one year of monthly expenses, including mortgage payments and other bills. That way if something happened to me or my job, I would have that cushion while we figured out our next move. Fortunately, we never needed to tap into the emergency fund, but I continue to use the system to protect ourselves even today.
Steady income
Having a constant, steady income was another key step in my process of buying a first house. I waited until I was very secure in my job and was reasonably certain I would not be moving on. I was working for Prudential Financial and even talked to my boss. I told him of my plans to buy a home and wanted to make sure my position was secure and I would not be transferred or even laid off. While in the Navy, I just moved around too much to make it worth buying a house, so I waited until I left active duty.
Good family situation
The time to buy a house is when you are secure with your relationship and family situation. For us, buying a house was stressful decision. If there are problems with your relationship, buying a house will make them worse. We waited until my wife became pregnant with our first son, that’s when I knew it was time to settle down in one place.
Budget
Only buy the house you can afford. Although banks will lend you more, I think the best mortgage budget is a housing payment that is no more than one week’s salary. That way, as long as I kept my job, I would always be able to pay the house note.
Since that first house, we’ve probably owned 20 houses, but I can always remember how stressful that first purchase was. With proper planning and preparation, I was able to reduce the stress a bit and really
Similar news:
RSS
Facebook
Google+
Twitter
