First-Time Home Buyers

It’s a wonderful journey to be on a mission to purchase your first home. We know – we are doing it right now! There are a lot of considerations to factor into the largest purchase you will likely ever make in your life. Take a look at the short list below!

Location / neighborhood -is the home in a safe neighborhood? How close is it to power lines or any construction sites? Are there cell towers nearby?

Price – what is the asking price? how much are you willing to go over the asking price while staying in your budget?

Monthly mortgage payment – remember: your monthly mortgage should be no more than 25% of your take home pay (ideally on a 15 year fixed). In CA, 15 year fixed would price us out of the market completely!

Beds/Baths – is your family expanding? do you need an office space to be able to work from home? will 1 bathroom truly work for you? (it’s doubtful)

Schools (for children) – what are the reviews for the nearby schools in the area you are looking at? If you plan on staying 5-7 years, what age range does that put your children in their schooling? Is there an inter-district transfer option? Are you planning on homeschooling? Private school?

Debt to income ratio – ideally you want your DIR to be under 30% and definitely not over 50%. If you are working to pay off the debt to get under the 30% threshold, make sure you are working the debt snowball. Remember, you want to see progress toward paying everything off.

No new debt! – most people don’t realize this, but taking on new debt when you are buying a home is a big red flag for the mortgage loan officers. Freeze your credit and stay away from opening a new credit card.

Did any of this resonate with you? If so, make sure to schedule a time to chat at the link below calendly.com/madsenfinancialcoaching/45-minute-consultation

Published by MadsenFinancialCoaching

Madsen Financial Coaching was created to bring awareness to personal finance. When you pay attention, you win! We work with clients to understand their behavior and relationship with money, as well as basics of personal finance such as: following a budget, eliminating debt and building an emergency fund to name a few. We want you to succeed, and it starts with your willingness to put in the work.

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