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How to Be Sure You’re Financially Prepared to Buy a Home in Chicago

Nov 9, 2021 | Industry News

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Buying a home is often the biggest financial decision (and commitment) in someone’s life. It might feel overwhelming if you’re just beginning the process, but when you prepare accordingly, you can move at the right pace and avoid a great deal of stress. Here are a few questions to ask yourself if you’re getting ready to buy your own home:

Do I Have an Emergency Fund?

We should all have an emergency fund, homeowner or not, but it’s particularly important for homeowners. If you’ve grown accustomed to a landlord taking care of repairs, homeownership can come with a plenty of new responsibilities. An emergency fund will help protect you from any unexpected expenses that can sabotage your budget. When you consistently add to your emergency fund over time, you’re better prepared for repairs and upgrades when the need arises.

What’s My Budget?

There are some additional expenses you’ll encounter as a homeowner that you weren’t responsible for as a renter. That doesn’t necessarily mean you’ll be paying more each month, but it’s important to be aware of those expenses and how they’ll impact your overall budget. If you’re not already in the habit of creating a budget for yourself and your family, now is the perfect time to start. Then, you’ll have an easier time assessing and monitoring all the expenses tied to owning and maintaining a home.

How Much Debt Do I Have?

Being entirely free from debt isn’t necessary to buy a home, but you should think about your existing debt when determining how much you can afford. If you’ve been carrying debt for a while, it’s a good idea to address as much of it as you can before buying a home. If you can’t pay it off fully, including it in your monthly budget will ensure you stay on track with your payments.

Have I Consulted with a Loan Officer?

A sharp, experienced loan officer can be invaluable when you’re putting the financial pieces in place. Getting pre-approved for a mortgage helps in a number of ways, but most significantly, it shows sellers that you’re serious, which can help you stand out in a competitive market. A loan officer will also answer all of your questions and make sure that you feel confident and well informed on the financial side of things before moving forward with the process.

 

If you’d like to talk more about being financially prepared to buy a home, or if you need to get pre-approved for a mortgage, please reach out. I’m always happy to be of assistance.

 
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