As rent prices continue to soar, many renters want to know what they can do to get ready to buy their first home. ApartmentList.com has recently released the following information:
“The first half of 2021 has seen the most rapid rise in rents since the start of our forecasts in the year 2017.Since the beginning of January, our rent index has increased by 11.4 percent. . . ?.
Renters may be unable to save enough money for homeownership due to rising cost of rent. There are many ways you could and ought to be preparing to purchase your first house. If you want to know more about how you can avoid rents rising, here are some expert tips.
Start Saving – Even small amounts of money – now!
Experts agree, setting aside what you can – even smaller amounts of money – into a dedicated savings account is a great starting point when it comes to saving for a down payment. Cindy Zuniga-Sanchez is the founder of Zero-Based Budget Coaching LLC.
“I suggest saving money to pay to buy a house in a’sinking account’. . . .It is a savings account that is separate from your emergency funds you can use to save for an expense that is short or medium-term.”
Zuniga Sanchez adds that saving small amounts can help in making the bigger goal – like saving for a downpayment -achievable.
“Breaking down your goalssmaller bite-sized pieces by saving incrementallyThis makes a daunting amount of things easier to manage.
Assess Your Finances and Work on your Credit
Another tip experts recommend to look at your overall finances and credit score and discover ways to lower your debt. According to the HUD, the average credit score of first-time homebuyers is 716. If you’re not sure of what your credit score is, there are numerous online tools that can assist you in determining your credit score. Don’t fret if your score falls below the average. Keep in mind that an average signifies there are homeowners with credit scores both above and below that threshold.
If you discover that your score is below the standard, there are several ways to improve your credit score before you apply for a loan. HUD suggests that you cut down on your debt as much as you can and make sure you make sure you pay your bills promptly and use your credit card responsibly, and reduce your overall debt.
Start the Conversation with Your Advisor Today!
Finally, it’s important to talk to someone who understands the market and what it takes to become a first-time homebuyer. We can assist you. A trusted advisor can help you navigate your specific market and guide you through all options available. A network of lending and real estate professionals in your corner can help you plan for the homebuying process and also determine the amount you can manage and how you can be pre-approved once you’re ready.
Most importantly, we can help you understand how homeownership is achievable. As Lauren Bringle, Accredited Financial Advisor with Self Financial, says:
“Don’t put off home ownership just because you earn a low income. . . .With the appropriate tools, resources and assistance, you could still be able to achieve your dream“
If you’re planning to be a homeowner one day, the best thing you can do is start preparing now. Even if you don’t think you’ll purchase for a while contact us now to talk about the process and prepare you for success in your path to homeownership.
This post was originally posted on Simplfy the Market