How to Buy a Home in Your 20s
Buying a home in your 20s is no easy feat. With the burden of student loans, an entry-level salary and a credit card (or few) it can seem impossible to think about ever owning a home. But it can be done. Here are a few tips for buying a home in your 20s:
Look for homes that have been on the market for a year or longer.
Did you know that you can filter your home search by listing time? Sellers that have had their home on the market for longer than a year are more eager to sell . . . and for a deal. This way, you get a bargain for your first home. While it might be bit of a fixer-upper, your property value will only appreciate over time as you continue to improve the home.
Be willing to live on the city’s outskirts.
If you don’t have enough savings for a down payment, but you have a great credit score, you just might be in luck to easily buy a home in your 20s. The United States Department of Agriculture has a program that allows first-time homebuyers to purchase a home with zero down payment as long as they have a good credit score and the home is located within the specified rural area. This way, you don’t have to worry about saving up a hefty down payment, and you can likely score a very affordable home.
Don’t buy a home above your means.
When you get preapproved for your mortgage, this doesn’t mean that you should be buying a home at the maximum preapproval amount. Owning a home doesn’t solely include paying your monthly mortgage. There are the taxes, fees, homeowners insurance as well the extra funds you’ll need to upkeep your home.
Do your research.
The U.S. Department of Housing and Urban Development has down payment assistance programs that are often geared toward first-time homebuyers or low-income homebuyers. Depending on if you have a certain salary and have good credit, completing a homeowner course might be all you need to do in order to qualify for these assistance programs. There are also grants that are designated for specific professions, like teachers and firefighters.
Start saving, even if it’s a small amount.
As a homeowner, there will always be an unexpected cost, whether a pipe bursts or the washing machine breaks. Even if you are able to buy a home without a downpayment and receive first-time homebuying assistance, you should still have a savings account to fall back on during these emergency moments. Start by setting a money-saving goal and trimming your budget to bulk up your savings account.