Well that sure sounds good doesn’t it? It just makes sense that we should all own a home!
I for one disagree! I think there is so much more to home ownership than just getting the mortgage and moving in. even though one may qualify for the loan there are other things to consider that I think are missed.
Here are just a few:
• If you are you relying on two incomes to support the payment are you prepared if you lose one of them?
• What is your life style? Do you like to go out to eat, travel, buy lots of clothes, have expensive habits like smoking and drinking? Answers to these questions will help one decide how much payment they really want to have.
• Are you making it now? Have you analyzed your expenditures and found that you can handle the new payment you will have? It doesn’t make any difference how much you qualify for, it’s what you can afford personally.
• Are your credit cards maxed out now? Will your refinance them with a new mortgage? If so, what are you going to do differently going forward?
• Do you have enough income to set saving aside for surprises? I just had to replace my furnace for $4,000,had some trees cut down for $2,000, and over the years have had many other surprises. Fortunately I have some savings but if I didn’t I would be in a lot of trouble.
• Are you anticipating a move some time? Will your house be salable even in a good market?
These are just a few things to think about. I believe that many people got into houses the past 10 years mostly based on how much the lenders said they could afford. There is much more to the problem, but that is a lot of it.
Home ownership is a great thing for many people, I won’t argue that. But if you don’t do some planning it can be the highest stress purchase you will ever make