For millennials ready to look at houses for sale, there are steps to take to ensure you find the right place for your budget and lifestyle. Despite certain challenges, it’s not impossible to find your dream home. Below are a few tips.
How Millennials Can Get Ready to Buy a House
1. Get Rid of Debt
For many millennials, debt is an issue, usually from student loans and credit cards. Carrying debt makes it harder to have a down payment for a house for sale and to secure the best mortgage rates if debt to income ratios are too high. Eliminate as much debt as possible before taking on a mortgage loan. Budget your month and target what you owe to clear it away.
2. Research Funding
Most first-time buyers are unaware of funding options besides conventional mortgages. There are government-backed choices, such as an FHA loan, that provide low-interest rates and possible low or no down payment when you qualify. Take time to research what is out there to reduce what you’re putting out and paying each month.
3. Save Up
The quicker you pay off the mortgage, the less you’ll pay in interest. One way to do this is to have a larger down payment, preferably 20%.
Not only does this reduce what is left to pay, but it also helps you avoid having to have additional insurances from lenders that protect them if you can’t make payments in the future. Saving money takes time, so set a goal and stick to your budget.
4. List Your Necessities
Once you have your finances in better shape, make a list of what you’re looking for in a home. This should include everything from the number of bedrooms to the location. Consider school systems, the proximity to public transportation, and other necessities that are important for day-to-day living.
Make a wishlist of amenities that would be nice but are not required, such as an in-ground pool. Once you have your lists and what you can afford, you can search for houses for sale that meet your criteria.
5. Look for Affordability
Take your time and search for a property that you can afford. Even with low mortgage rates, you want a place that doesn’t stretch your budget too thinly.
Housing payments should be no more than 25% of what you take home, including interest, taxes, insurance, and the principal balance. Opt for a 15-year fixed-rate conventional mortgage to keep your payments manageable.
If you are ready to look at houses for sale in Red Wing and the surrounding areas of Minnesota and Western Wisconsin, contact Lawrence Realty. Since 1948, the third-generation, family-owned company has helped clients find the perfect property for their needs. Their professional, friendly team can also help when you are selling your house, securing a buyer and ensuring a stress-free process. Call (651) 388-4745 for more on houses for sale or visit them online for their real estate listings.