Home Buying – Should or Shouldn’t I?

Noble Credit Union is located on 175 N. Clovis at the corner of Palo Alto and Clovis Avenues. (Courtesy of poungsaed_eco/Envato Elements)

Buying a home is the most important purchase of your lifetime.  To help put you at ease and to make sure you’re really prepared for this purchase, we’ve compiled a list of questions to ask yourself before buying a new home.

Can I afford to buy a house?

Before viewing properties, remember that purchasing a new home will cost more than just the down payment. Buyers also need to cover closing costs, which typically run at 2-4 percent of the total purchase, as well as moving costs, and possibly new furniture and renovations for their new home.

Can I afford the monthly mortgage payments?

Most lending companies will grant a loan to a homebuyer if the monthly mortgage payments do not push the buyer’s debt-to-income (DTI) ratio above the recommended 43 percent. This means that the total monthly debt the buyer carries, including their mortgage, credit card, loan, and car payments, do not exceed 43 percent of their monthly income.

When determining whether you can actually afford your monthly payments remember to include calculations for taxes, insurance and a possible increase in utility bills. Calculate what you can afford at https://bit.ly/MyHomeCalculator.

Am I ready to settle down?

The average length of time that homeowners in the U.S. live in a house is only seven years. Consider factors like your career, family planning, changing demographics of a neighborhood and more when trying to answer this question. Experts advise buyers to only purchase homes they plan on living in for a minimum of five years.

Is my credit score high enough?

A fairly decent credit score is necessary to qualify for a home loan. A score that doesn’t make the cut can be increased by being super-careful about paying all bills on time, not opening new credit cards in the months leading up to the home loan application, paying credit card bills in full each month and keeping credit utilization low.

Do I have a plan in place for repairs?

When a renter has a leaky faucet, they call the landlord and the problem becomes theirs. When a homeowner has a leaky faucet, it’s their own problem. They can either fix it or hire someone to do the job, but it’s a good idea to have a plan in place before the first thing in a new home needs fixing. It’s best to have a tidy sum put away to pay for necessary repairs before purchasing a home.

If you’re ready to get started on your home loan application, visit www.NobleCU.com to learn more about their fantastic home loan options.

Noble Credit Union, voted one of the best in California. They offer members full access to a wide range of financial services, including checking and savings accounts with no monthly fees, online and mobile banking, new and used vehicle loans, and more. For more information about membership at Noble Credit Union, call (559) 252-5000 or visit NobleCU.com.