Since buying a house is a dream shared among many people, many tend to convince themselves it is an opportunity they cannot miss out on. Though, it is important to note that the decision to invest such a large amount of money will likely affect your funds for plenty of years. It may be worth looking at your financial standing to determine what the right time for you may be. Let us take a look at when you should consider not buying a house.
Excessive debt
While having a certain amount of debt is not a problem, owing lenders notable amounts in debt could curtail your ability to avail a desirable interest rate for a loan. Getting a mortgage when you are already facing a debt crisis will only worsen your financial issues. This is why it is better to work toward cutting your debt before you prepare to buy a house.
Anticipating significant expenditure
It is not wise to add a hefty expense such as a home purchase if you already expect to have significant expenditure coming up in the future. This could be things such as planning a wedding or a baby or a job change. You would not wish to lose the ability to make timely payments on your mortgage every month. Instead, you should consider postponing the decision to buy a house until other major commitments are met.
Having insufficient emergency funds
You may consider yourself a good planner but not having sufficient emergency funds is a sure shot way of landing yourself in financial troubles when buying a house. It is advisable to have a year’s worth of living expenses to make sure you have the funds to tide you over in case of a sudden event like a job loss or unanticipated expenses. Similarly, you must make sure your earnings are at a healthy level such that mortgage payments each month do not surpass 30% of the earnings.
You can get in touch with me for any assistance or advice about buying or selling a home in Greater Boston. Feel free to call me or send me an email or get in touch on Facebook.
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