The Millennial Home Buyer
If you are a millennial reading this, it may sound hard to believe. Buying a home in your 20’s? That sounds impossible, what with potential student loans, low-paying jobs, and (potentially) no significant other to help out with payments. Blogger Lauren Bowling was single and owned her own home by the age of 26. Here are some tips from her blog that prove it can be done!
1.) Know Where You Want to Live
One of Lauren’s biggest pieces of advice was to know exactly where you want to settle. She moved to New York for two years before finally settling back in her home state, Georgia. Settling into one location is crucial to knowing whether you want to buy a home. You aren’t just investing in a permanent home; you are investing in a permanent location.
If there is somewhere you want to live for the next three to five years, you could easily start figuring out how to buy a home in the foreseeable future.
2.) Store up Credit
Lauren emphasized the importance of building credit to get a mortgage, and she is completely right. 20-year-olds usually have little credit, so approval for a mortgage is more unlikely. She advised to get a credit card with a smaller limit so it is easy to pay off.
If you already have credit, she advised to check it often to make sure it stays at 30% or below your credit limit. It’s important to keep paying off your balance, so be sure you are responsible enough to do so
3.) Pre-Approval for a Mortgage
Knowing what you can actually spend on a house is crucial. Sources like Bankrate help you determine how your monthly payments would be affected depending on interest rates and your initial down payment. Lauren also emphasized the importance of rate shopping. Look for what rate you see you could afford. There isn’t a set rate everyone has to follow, so look for your best fit.
4.) Save, Save, Save
If you are truly committed to buying a home, then save, save, save. Lauren advised that for about six to twelve months, steadily save a set percentage of your paycheck and put it into a down-payment fund. She saved 20% of her paycheck, but you can choose your rate depending on your living situations. Setting the goal for how much you aim to save will determine how soon you can make a downpayment on a home. Lauren stated that this was the most crucial step for buyers in their 20’s, and we think so too.
For more on Lauren’s tips and tricks, check out the link below: