Tips for Millennials Looking to Purchase Their First Home
November 25, 2019
Purchasing your first home is a big step to take, but it is also a very exciting one! There are so many different guides on first time home buying; but for the millennial generation, purchasing a home looks a bit different than it looked for other generations. Many think that millennials are not purchasing homes, but in fact, for the past few years, millennials have purchased more homes than baby boomers and Gen Xers. So, to join the ranks of other millennial homebuyers settling into their new homes, take a look at these few tips for any millennial looking to purchase a new home.
Know Your Budget
Budgeting is one of the key parts of home-buying. When you are looking to create a budget for your new home, be sure to estimate monthly mortgage payments as part of your expenses. The best way to know what you can afford mortgage wise, is to subtract all expenses that you already have and see what money is left over. Monthly expenses are usually things such as utilities, food, travel, medical and personal expenses. If there is outstanding debt, such as student loans, be sure to factor in the costs of those payments as well. Generally, if it is at all possible, it can be good to go into the home buying arena debt free.
Building credit may seem hard, but at the end of the day it can be done with just a few little actions. Paying your bills on time is the best, and easiest, way to build credit. Whether it is monthly rent being paid, or utilities, or credit card payments, being on time shows that you are capable of making your payments responsibly. If you do not have a credit card, getting one is a fantastic way to start building your credit.
Make a Features List
Before buying a home, or even looking at homes, it is important to put together a list of features that you want to see most in your new home. Have a number of bedrooms and bathrooms, know if you are looking for energy efficient features to save money on utilities, know if there are some things, like a waterfall shower, that you just cannot live without. Having these features outlined already makes things easier as well as help eliminate options right off the bat.
Research Homes Online
Manufactured homes are up and coming, but not everyone knows about them. Look into different kinds of housing options that may fit all of your needs, but you did not know they existed beforehand. Manufactured homes are often perfect for a first-time home, and millennial homebuyers can benefit from a myriad of things in relation to manufactured homes, such as affordability, more freedom, and energy efficient sustainability options!
Save for the Down Payment
Down payments, just like you would make on a car, are a great way to kickstart a home loan. By placing a down payment on the house, you will not only be able to pay your home off faster, but you will save in interest in the long run. It can be difficult to save for a down payment, but with a good budget and a little dedication it can be done!
No matter what kind of home you are looking to purchase, obtaining a preapproved loan takes the guesswork out of the picture. What's the point of falling in love with a home you "think" you can afford, when in reality you won't be approved for the amount. It is best to contact your financial institution to begin the preapproval process so you know what you can fall in love with.
The last tip is - be patient! It may be hard to take the time to pay off debts, save for a down payment, or search for the perfect home with all of the features that you are looking for within your means. Each piece of the process of home buying takes its own time, but with such a big purchase it is crucial to make sure that everything is done correctly, and that the home is exactly what you're looking for.
With these tips and tricks, purchasing a home should be a fun, stress-free, and very exciting experience! It is important to remember that purchasing a home is a process, and processes take time, but with a little patience and a lot of dedication, everything will work out in the end.