If you’re someone who likes to plan and prepare for major life events, you might find it frustrating that some milestones don’t come with a corresponding age. For example, you might have gotten your driver’s license on your 16th birthday and attended college at age 18, but what about having a child or renting an apartment downtown? At what age is a person ready to buy homes for sale in Springfield MO? Straight out of college, at 22? A few years later, at 25? Or should you stick to renting until you’ve hit the big 3-0?
Well, first of all, planning for the purchase of your first home is different than student housing – it should be based on your financial situation, not your age. A 23-year-old with no debt and a steady job is in a better position to buy a home than a 35-year-old with a weak credit score, piles of debt, and few savings.
To start off, how much debt do you have? If you’re paying off student loans, car loans, and credit cards, you shouldn’t be thinking about a home just yet. Stick with renting until you’ve whittled down that mountain of debt. Similarly, if you don’t have a good credit score due to previous bad financial decisions, continue renting until you can built that number up. Your credit score will be very important when you try to secure a mortgage.
It is also vital that you have a good pile of money put away in your savings account. There should be enough there for a down payment, of course (preferably 20%), but that’s not all! What if you buy a house and then suddenly lose your job or have a medical crisis? That’s where 6-12 months of emergency savings come into play. Finally, remember that you’ll probably be spending a little extra from time to time on maintenance costs. Make sure you have enough money in the bank so that if the pipes burst or your AC breaks, there won’t be any reason to panic.
Finally, you need to think about stability, both in your location and in your occupation. If you aren’t prepared to stay in this home for 4-5 years, you probably shouldn’t be buying it at all. You need to commit yourself to this city and this home. And while few of us feel completely secure in our jobs, you should at least be sure that unemployment isn’t on the horizon.
So while there isn’t a magic age when it comes to buying your first house, there is a financial and occupational checklist that you should run through before you decide to take the plunge and purchase your first home.