ou may have heard about the record low interest rates currently available to loan borrowers to purchase a home. In part due to the shockwaves of a global pandemic, 2020 was a great year in terms of low mortgage rates (and that's about it) and 2021 is looking to continue to be impressive so if you have been a renter, is now the time to buy a property? That is a question that so many people are asking themselves but understandably, the idea of buying your first property - especially after a year of such uncertainty and shattered plans - is a daunting one.
Ultimately, this blog post can't tell you for certain whether or not now is a good time to buy a property. That is a very personal decision that is contingent on a few different factors but in thinking about this group of people taking new steps in adulthood, I did want to put together a few simple steps to take when considering making the shift from renter to owner.
- Save money for a down payment. Contrary to what you may think or have heard, saving the money for an initial down payment doesn't have to be excruciating. You don't need to have 20% ready to hand over, the payment could be much lower to the tune of 3.5%. I would advise that when you are doing the math and budgeting to find your price range, consider what percent of that total you could hand over right now.
- Build your credit score. The words ‘credit score' can be triggering for many because as it is always looming and despite your best efforts it can be hard to understand. A few main ways to ensure you keep a quality credit score is to pay your bills in full and on time. There are also a multitude of services that allow you to check your current score and find any blemishes that you need to address.
- Chat with an agent. You don't need to wait until the day you're ready to buy to discuss your options with a professional. Most agents will be very understanding and aware if it is your first time buying and will be more than willing to help you sort out your plan and many have a rolodex of referrals they can provide you with in regards to financing, attorneys, movers, etc. And I happen to know a pretty good one!
- Get pre-approved for a loan. As your trusted real estate professional, I can connect you with a local lender to find out how much you can borrow and what your monthly payment could be.
We could dedicate entire posts to each of these steps and this was a simplified overview but hopefully if you are someone who has considered dipping their toe in the buying game then this will give you some place to start.