Sometime around the first of each year, many of us find inspiration to embark on new endeavors. We feel energized imagining how our lives will be different (in good ways) by the next time January 1st rolls around: “I’ll be 10 pounds lighter.” “I’ll have run my first marathon.” “I’ll have planted and tended a prize-winning garden,” and so on. A number of us might even vow to purchase a new home. What follows are some tips on getting ready to take the plunge.
Finding a house you can afford
Take your annual salary and multiply it by 2.5. The product is the amount you can (reasonably) spend on a house, or so the word on the street is. It’s important to take into account more than your income, though. Looking at debt and expenses is critical, too. CNN Money offers an on-line home affordability calculator to guide in setting goals.
Saving money for a down payment
To save $20,000 (10% of the national median home price of close to $200,000), for example, you’ll have to put away about $830 for each of 24 months. Michele Lerner of dailyfinance.com has outlined a plan for amassing enough cash to stake your claim on the property of your choice in two years. Lowering expenses and increasing income are key, and might require some major lifestyle shifts, even if only temporarily.
Getting your credit history clean
Examine your credit report for any inaccuracies. Make sure to fix problems as soon as possible.
We’ll check in with you NEXT January, to see how your plans are shaping up!
Blog post by the Joyce Lebedew Real Estate Team
Photography credit: Veer.com