If you think you might be ready to put in an offer on a house, you could be right. But how can you be sure? When you make an offer you commit to follow through if that offer is accepted, so it’s a very serious thing to do. You don’t want to take it lightly. Fortunately, there are some signs that can help you determine that you may be ready to put an offer on a house. Then you can decide if it’s truly the right time, and start looking for the right place to fall in love with. There are plenty of houses out there, so there’s definitely one that’s right for you. It’s important not to buy too rashly, but you also want to make sure that you’re ready when you see the house you want. That way you won’t lose a great place due to lack of preparation.
1). Do you have your pre-approval letter?
Before you get started on finding the perfect house and putting in an offer, you want to make sure you’re pre-approved. That lets you know how much a lender will allow you to borrow, and also shows the seller of the house that you’re serious when you make an offer on the house you decide you want to buy. It’s not that difficult to get a pre-approval letter, provided your finances look good and you’re willing to provide the lender with the information they ask for. Still, it’s a very important step toward getting ready to make an offer.
2). How does that down payment look?
When you’re buying a new home, you’ll need to put some money down on it, and then generally finance the rest. The down payment can be a smaller one or a much bigger one, depending on the type of loan you’re getting, but it’s important to make sure you have enough saved up. Ideally, you should put 20% down on your house. That will help you avoid private mortgage insurance (PMI), lowering your mortgage payments, and giving you more equity in your home. Some people put as low as 3.5% down, and there are a few no money down options, but it’s often considered to be a better financial choice to have more as a down payment. Make sure you have what you’re comfortable with.
3). Have you checked your credit score?
You won’t be ready to make an offer if you have bad credit. While it’s not necessary for your credit to be perfect, you should have a reasonable credit score. Most lenders aren’t able to help buyers who have scores under 620, and even then it can be difficult for some buyers to get financed. If you have a score over 720, you’re much more likely to see better offers and lower interest rates from lenders. You’ll also have a higher chance of being approved, which is very important. When you’re ready to make an offer, it’s very frustrating to lose the house because your credit score isn’t high enough to get financed.
4). Did you fix those problems with your credit report?
As you spend time considering the purchase of a house, you want to focus on more than just your credit score. Your actual credit report matters, too. Even with a high score, there could be problems on your report. Sometimes, credit bureaus make mistakes. If they do that, your report could show some negative information that’s simply not true. If you contact the credit bureaus you can generally get that corrected, but it might take a while to be reflected on the report a lender would pull.
5). How long have you wanted to buy?
If you’ve wanted to buy for a long time, you’re probably more likely to be ready to make an offer. Buying on impulse can be a dangerous choice for something as large and expensive as a house. By assessing how long you’ve wanted to purchase a house, you can get a better idea of whether you’re really ready to make an offer. That way you’ll have peace of mind when you do decide that it’s time to purchase, whether that’s now or later.
6). What do you know about the neighborhood?
Before you make an offer, you want to be sure you’re comfortable with the neighborhood. Some areas are better than others when it comes to what you’re looking for, and by choosing the right one you’ll be happier with your house for a longer period of time. Be sure to spend some time in the neighborhood where you plan to buy, as that will help you feel more at home there when you decide it’s time to make an offer.
7). Are you committed to putting down roots?
If you’re sure of what you want and need to do when it comes to buying a house, you’ll be more prepared when the time comes. Part of that is feeling settled, or wanting to feel settled in your local area. If you’re not ready to settle in one place, at least for a while, or you think you may have to move soon for work or other reasons, buying a house might not be the best choice for you. For people who are ready to make a home in their community, though, making an offer can be just the right choice.
2 Point Highlight
Fortunately, there are some signs that can help you determine that you may be ready to put an offer on a house.
If you’re sure of what you want and need to do when it comes to buying a house, you’ll be more prepared when the time comes.
