Buying a Home in your Twenties
For most young men and women in their twenties, deciding to own a house might be a tall order. If you are twenty-something, you could be still paying your student loan from the meagre salary you’re making as an entry-level employee.
However, you’ll be pleasantly surprised to learn that nearly 80% of youngsters born after 1998 wish to own a home sooner than later. If you are looking to buy a home as a young adult in your twenties, Bowson Property can help.
As an established property management firm in Newcastle, we have helped scores of Gen Z adults choose their ideal home. You can too by following these tips:
Save Aggressively for a Year
At the very outset, you will have to figure out a way to pay the monthly instalments of your mortgage. Also take into consideration, the closing costs as well as the down payment. Unless you are inheriting a fortune from a rich relative, you should start saving aggressively.
Our estate agents in Newcastle will tell you that the mortgage type you qualify for will determine the amount you pay as down payment.
Look for special mortgages designed exclusively for first-time homebuyers, for instance, a FHA mortgage. If you become eligible for an FHA loan, you will have to pay just 3.5% of the asking price as down payment.
Closing costs usually constitute 2%-5% of the price you pay for your new home. To build a hefty nest egg for the down payment, EMIs, and closing costs, you’ll need to save with a missionary zeal.
Do the Homework to Qualify for a Mortgage Preapproval
Once you have a sound roadmap of your home loan repayment plan, start working towards qualifying for a mortgage preapproval.
Potential lenders will review your annual income, belongings, savings, employment history, arrears, debt repayments, and most importantly, your credit scores and reports. Your credit reports and credit scores could make a big difference.
You can use a free online loan/financial calculator to evaluate how your tentative down payment and interest rate could influence your monthly disbursements.
Make Up Your Mind on Where You Wish to Live
Like the majority of individuals in their twenties, you may change jobs frequently, explore the world, and be a rolling stone. However, chances are that you will want to purchase a house in the city you wish to live in permanently. Once you decide where you wish to make your home, be to choose a home that’s conveniently located.
Work on Improving Your Credit Score
You will face an uphill task getting a mortgage preapproval with an abysmally low or no credit score. Time to build one slowly and meticulously.
Get a credit card, use it for small expenses, and pay off your credit card bills consistently. Once you have a respectable credit score, review it periodically, and try to shore it up steadily.
If your current earnings do not allow for substantial savings, you can always start saving when you land a lucrative job. Meanwhile, you can rent a home, postponing your home buying plan for a few years.
Once you become financially stable and build a sizeable nest egg, you can start contacting our letting agents in Newcastle for a suitable property.
Our experienced estate agents in Newcastle can help you find the perfect home to suit your style and budget. Contact us today for a chat.
You’re in Safe Hands