Homeownership is one of the largest steps someone can make in life. It’s an incredibly expensive decision that locks you into a mortgage for fifteen to thirty years and requires a ton of planning. Still, many people aren’t sure what steps are necessary to make homeownership possible.
These are some financial obstacles most people face when unable to become homeowners yet, and what can be done about them.
An Underpaying Job
How much does your job pay you? The average amount of money to afford a two-bedroom home in America is between twenty to thirty dollars an hour. Since the minimum wage is $7.25, there are some discrepancies for how this is possible. One of the most important things you can do is either seek out new work or consider getting training to improve your job prospects. A fantastic option is to take coding lessons online for free; you can even find some on YouTube and teach yourself how to code when you have the time to do it.
Bad Credit History
A good credit history is vital to being able to buy a home. This means a score of at least 640, with at least a year of history on a couple of cards, and a great payment history. All of this matters to lenders so that they can trust you. If your score is below 640, the good news is that the lower it is, you can build it faster. Consider building your credit as one of the most important steps to buy a house, and set a goal to get your score up over a year or two. This could mean paying off debt and opening a credit card that you don’t spend more than 25% on, but it’s worth it for the end result.
If you don’t have savings, it’s not the end of the world, but most lenders like to see that you have some ability to save and manage your money so that they know that after one emergency, you won’t suddenly be unable to afford anything. It’s a good idea to put in the time and money to build a savings of at least three months’ pay so that you can prove you have a buffer if anything goes wrong. This can be difficult for anyone, so don’t expect yourself to do it in less than a year; it takes time to save.
Trying to Find the Perfect Home
Many house hunters get in their own way when it comes to buying a home because they’re unable to let themselves buy a home that’s less than perfect. The thing about less-than-perfect homes is that they can easily be made to suit what you need. This means you get to put your fingerprint on a property and create a space that feels like home to you.
Homeownership Is Possible for Everyone
Although it may seem like a lofty goal: everyone can afford homeownership if they follow these steps. Teach yourself coding, work on your credit score, create savings, and be looser with your standards: and you’ll find an awesome home you can afford to put your touches on.