How I Managed to Buy My Own Home at 25

 

This article has been syndicated from Hello Brittnee, an InfluenceHer Collective Member. Read the full post here

One of the most common questions that I get from people is usually around the fact that I am a homeowner, a young one, and “how/why did I do it?” Well, for starters, it’s a condo to be more specific, which is the perfect size for someone like me (and my dog, boyfriend, and unborn child). I realized over time that with my personal lifestyle, buying a place because it was a better fit for me. No more pet rent, no more people running around in the place above me, no more missing packages. There were a lot of positives when I compared to the things that I had gone through.

How did I buy my home? 

So many things went into the process of buying my condo. It wasn’t a one and done type of thing where I could just pick out a place and make it mine. I wish things worked out that way, but they do not. If they did, I would be in a different condo that was a bit cheaper and had some installations that my place does not have. But, that’s not the point. The point is that it is a lot of work which I feel deters a lot of young people. It shouldn’t, though – if you work with a reputable team.

Before I dive into the details, let me be real with you. I have debt and I was able to do this. I have talked to people that think because they have student loan debt that they can’t do this which is wrong.

Excluding my utilities and payments that go along with my home, I have:

  • Student loan debt
  • Car payment
  • Health/Dental Insurance payment
  • Dog health insurance payment

And, I’m able to do this. Don’t let your debt and bills scare you away. Here's my advice:

Do your research.

I think many people get turned off when they hear about other people’s process with buying their home. It sucks because every experience is different. There are people that I know that had an easy process and others that have a long drawn out process. Some people stuck to one lender and didn’t explore their options or they didn’t have a realtor/someone on their side to hear them out and make things work for them.

Yes, you need to do your research so that you can have a great process. No one is going to do it for you. You need to figure out what documents you need to collect and share, what lender you want to work with, which realtor will be the best fit for you and more. It’s not a lot of work if you have a referral group that you can turn to for contacts. Make sure that you consider the location that you want to live in and your commute to work. I made sure to include those in my decision-making.

Work on your credit.

Your credit score is going to determine a lot of things for you – from your interest rate to the amount that the bank would allow you to spend. Your credit should be established in some way when you start this process. You can pay your bills on time every month, but that doesn’t mean much. The bank wants to be able to see how you handle your debts and payments. It seems annoying, but that is their strategy to figure out if they can trust you will pay back the mortgage loan that they are going to lend you.

On my end, I had student loans that I was paying into since I signed up for them which helped me build my credit. Along with getting a credit card, I had started to build my credit early. And, I was lucky enough to have a dad who has great credit and added my name on his credit card for a year – this helped out a lot. If you’re planning on buying, start establishing your credit now. Better now than never. Keep up on your payments and avoid having collections pop up on you and knock your score down. Show the lenders that you are reliable and that you will pay them back.

Create a budget.

When money is involved, a budget needs considering. If you can live life without a budget then go you, that’s great, but many of us are creating budgets. When you meet with your lender, and they create your buying budget, it gives you some perspective, but it doesn’t stop there. You need to look into your bank account and tally up what you will be willing to spend and how much you want to put into everything. You can have a maximum of $200,000. But do you want to splurge on a $200,000 home when you can find one that is similar but $20,000 less?

A budget is going to keep you and your account in check. You will know your spending point and keep to it. Many people think about budgeting and dread it but it’s a great practice. You have things to think about like extra fees — closing costs, inspector costs, updates, and moving costs. Start saving now if it’s in your plans to purchase soon so your budget is off to a good start. Your finances will thank you for paying attention to them.

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