Buying a property is one of the best investments you can make but before you dive in, it is important to make sure you are prepared for the financial and practical responsibilities of home ownership.
Before you start down this path, it is important to ask yourself some important questions:
- How much debt am I carrying?
- Do I carry a balance on my credit card(s)?
- How much is my monthly car payment?
- How good is my credit?
These questions will not only determine the house you are able to buy, but also the cost of borrowing, or how much interest you'll pay on your mortgage and ultimately, your ability to enjoy the new home. You should also consider asking yourself how home ownership will affect your lifestyle. Are you ready for a long-term financial commitment? Can you hold out on selling for a few years if the market dips? Are you ready to put in the time, effort, and money to maintain a property? Also consider what would happen if your income decreased or disappeared. Would you be able to get by? For how long?
Don't let these questions dissuade you from making one of the best financial decisions possible. Rather, use them to make sure you're taking the decision seriously and have the right people helping you along the way. For a better understanding of just how big of a difference home ownership makes to your financial future, check out the next article in the series, You Can't Afford Not to Buy.