You’ve dreamt; you’ve planned; you’ve waited. Are you finally ready to build? On the surface, it may seem like everything is under control, but on closer examination, you may not be as ready as you think. If you think you’re all set to build, take this test to find out!
Finances
The bottom line is, well, the bottom line. The first area to consider when planning to build a home is your finances.
Is your debt under control?
Whether it’s student loans, a car bill, or a maxed out credit card, debt can put a serious damper on your home building experience. Taking out a mortgage is a serious endeavor. Before you build, you’ll want to make sure that you have your debt under control. To test this out, set aside a full mortgage payment and try going a full month without using any credit cards. If you can do it (and not starve), you’re probably in fairly good shape. Debt doesn’t necessarily mean you shouldn’t start building, but it does need to be manageable, and you shouldn’t be accruing more each month.
Is your credit score up to par?
Your credit score will affect how much money you can borrow as well as your loan costs. If your credit score is good, then you probably won’t struggle with getting approved for a mortgage. A poor credit score is a red flag—to you! If you haven’t managed your credit up until now, you probably won’t do any better with a mortgage. Work on getting your credit score up before deciding to build.
Have you saved enough for a down payment?
Because you’ll be paying interest on the money you borrow, the more money you can pay down, the better. While you may be able to slide by with a low down payment, you won’t be helping yourself in the long run.
Have you properly assessed your budget?
There are lots of hidden costs in buying a home. Here are just a few to keep in mind:
- Closing costs
- Insurance
- Taxes
- Moving expenses
- Time off of work
- New furnishing
- Homeowner’s association fees
- Utilities
The actual cost of building a new home is far more than just the price tag on the house. You’ll want to thoroughly evaluate your budget before you decide to move to a new home—especially if you decide to build.
Stability
Building a home is far more permanent than renting a house or apartment. Here are a few questions to test your stability.
Are you at a stable job with no chance of transfer?
Building a home is a lot of work. If your career is on the move or you plan to change jobs in the near future, you may want to hold off on building. The investment of time, money, and resources is not something you’ll want to repeat often.
Are you ready to settle down?
If you’re ready to stay in one place, great! If you still have a little wanderlust left in you, you may want to reconsider. Homeowners have far less freedom than renters, so you’ll definitely be tying yourself down with a new build.
Have you considered exactly where you’d like to live?
Sure, you’ve considered the general area you like to live, but what about the specifics? Do you have a neighborhood picked out? What about a school district? Have you considered how the area will develop over the next five years?
Plan
So, what’s the plan, Stan? If you don’t have one, put the brakes on!
Is now a good time for you to move?
Moving is a huge undertaking of its own. Add building to the mix, and you’ve got your hands full. Assess your personal situation before moving forward. Do you have a good support system around you? Have you thoroughly researched what you’re getting into? Are there any major stressors coming up soon?
Are you prepared to take on the extra responsibilities of homeownership?
In a rental, you’re able to entrust repairs, security, and some of the responsibility to someone else. With a home, you’re all on your own! Be sure to consider whether or not you want to take on all that homeownership brings with it.
If you answered yes to all of these questions, congrats! You’re on to the next phase. Contact Homes By Brill to start building your next home. As one of the leading home builders in the Des Moines area, the professionals at Homes By Brill will guide you step by step through the home building process. Schedule your consultation today!
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