Tiffany Pesonen's Blog
It's the early years of home ownership that can make buying a house challenging. Closing costs, interest, property fees and home repairs are among the major challenges.Many people prefer to take on these challenges during their early adult years. Vigor and a fresh approach to home ownership aid with roofing, landscaping, flooring and appliance maintenance work.
Buying a house during your middle years could work
Buying a house during early adult years also gives you more time to pay off a mortgage. Take on a mortgage later in life, and you could end up making higher monthly mortgage installments. Plainly put, buying a house near retirement could cost you big, financially and physically. It could also help you to save on monthly housing costs.
You could save money on monthly housing costs because owning a home might:
- Eliminate your need to make monthly housing payments. For example, you won't have to pay monthly rent. Pay your mortgage off early, and you could eliminate monthly mortgage payments from your budget.
- Offer you the space and legal rights to rent out one or more rooms at your home.
- Position you to receive tax advantages, money that you could use to add to your house's value or invest in your personal retirement.
Because lenders are not allowed to discriminate, you could be approved for a mortgage. Ask your mortgage broker or realtor about mortgage amortization schedules, homeowners association fees and property taxes. Also, find out how much houses in areas you're thinking about buying a house in are worth and how the property values have lowered or risen over the last several decades.
Property value trends in areas you want to buy a house in are important
Buy a house that has value that matches or exceeds what you pay for the house and you could earn a profit should you decide to sell the property 10 to 15 years later. Go with a 30 year mortgage and you could be responsible for paying lower monthly mortgage installments.
Just because you took out a 30 year mortgage, doesn't mean that you have to make payments for 30 years. You could pay your mortgage off in 20 years or less. That could put you in a position to reside in a house with only utilities, general maintenance and property taxes to pay.
Open to the idea of taking in renters and you could generate enough rent to cover the entire costs of your mortgage. Vet all potential renters thoroughly before you pursue this option. As it regards renters, you could also rent out one or more rooms at your house to your grandchildren while they attend college or after they graduate. Rent out the space at a lower rate than apartments rent and your grandchildren could appreciate the deal.
Above all, make sure that you can readily afford to take on a monthly mortgage. Don't just ensure that you can cover a monthly mortgage. Also, ensure that you can continue to invest in your retirement.
- Strong down payment (you may have to give yourself one to two years to save a good down payment)
- Good credit scores
- Flexibility regarding house type and location
- Rewarding money management habits
- Job stability
- Knowledge about housing markets
- Clarity around what you want in a house