How to Know if You are Financially Ready to Buy a House

posted in: Housing | 0

You won’t know, until you ask.

Below are three real world examples of people who bought their first home and how they did it.

Rent Rooms to Pay Off the Mortgage:

Ken Thayer, President of Residential First Capital, talks about the first home he bought. Back in 1981, Ken was working at his first job. His job was all commission so he did not have a steady income. But he found a house he wanted to buy. He borrowed the down payment for the home from his mom. The home had three bedrooms. Ken rented out the three bedrooms to roommates, with their rent paying off the mortgage, taxes and insurance on the house. He built a fourth room in the garage and that’s where he lived. He was able to buy that house, it appreciated and he sold the house for much more than what he paid for it. He then went on to buy his second house with his own money and no help from anyone.

Take Your Time and Be Honest with Yourself

Karen Gledich, VP of Operations at Residential First Capital, bought her first home about 5 years ago. It took her about a year to find a home. She was really conservative when she started looking at homes with her husband. They wanted to make sure that no matter what happened to either of them, they could still pay off the mortgage. They knew before they started looking how much they could afford for their mortgage each month and how much of a down payment they could afford. They started looking at homes in that price range, in good school districts and easy access to work. Once they found a home they loved, they put an offer on it! It has appreciated in value from $600k to $825k in five years. Her total housing expense each month (mortgage, amenities, etc.) is $2,400. That house today could rent for $3,000+ and continues to climb.

Buy with a Friend to Help Pay the Mortgage and Down Payment

Ken Thayer’s daughter, Haley Thayer, lives up in Seattle, WA. She came to Ken about a year and a half ago asking about the opportunity to buy property. Seattle is a very hot market and she thought that it was smarter to buy rather than rent due to the demand. Ken knew Haley could not do it on her own, so Haley reached out to a family friend to go in on the future house. The two girls found a townhouse in Capital Hill, Seattle. The parents helped them with the down payment with a contract stating that they would pay the money back once they sell. They qualified to pay for a $710k property. In just 6 months, the property has appreciated to around $780k.

There are many creative ways to buying property. It may not fit in the traditional way of buying a home but the payoffs are huge. are so many different avenues and loans you can get to provide financing to be able to buy your home. We can help you no matter what situation you are in. Just ask!