Are you thinking about buying your first home? If so, consider taking these steps:
First, save for as big a down payment as you can afford, but aim for 20%. A larger down payment can help you avoid paying mortgage insurance. And as a first-time homebuyer, you might qualify for down payment assistance provided by a housing authority or nonprofit organization.
Also, look up your credit score. A higher score can result in a lower interest rate.
And check with various lenders to see how large a mortgage you can get. But even if you qualify for a mortgage of a certain size, you don’t have to take it. You don’t want your payments to be so large that you become “house poor” and have trouble meeting other needs, such as investing for your retirement.
Finally, try to build an emergency fund containing a few months’ worth of living expenses to pay for those extra costs of homeownership, such as repairing your roof or replacing your furnace.
Homeownership can be a rewarding experience – and the rewards will even be greater when you’ve prepared yourself financially.
This content was provided by Edward Jones for use by Daniel Pellerin, your Edward Jones financial advisor at 189 East Main Street Suite G, in Newport, (802) 334-6261.