Buying a house is a huge undertaking to many. It is a big commitment that will last for a very long time. It requires the buyer to have some behavior and quality of life that put the mortgage payments first.
You must be prepared and make sure that you have all pieces of the puzzle before you buy a house.
In this article, you will learn top 10 reasons you might not be ready to buy a house.
Table of Contents
- Your credit score is not good
- You have other debts and loans (college debt, car loan, etc)
- Cannot afford rent easily
- You don’t have a down payment
- You have unstable life style
- You are irresponsible
- Your future is uncertainty
- You hate dealing with maintenance and repairs
- You don’t have a stable source of income
- You don’t have an emergency fund and are not saving at all
- You have multiple big expenses in your horizon such as wedding
- You will be sacrificing other life necessities
- You don’t know the kind of house you want
1. Your credit score is not good
If your credit score is not in acceptable levels, forget about buying a house. Unless you are paying with cash, a bad credit score will get you in trouble when you are hunting for a mortgage.
Why do you need a good credit score? Well, this is a good question. Your credit score is your resume when it comes to mortgages and loans. Your lender will know your money handling behavior by looking at your score. For this reason a bad credit score tells the lender that you are irresponsible and do not use your money wisely. For this reason, it will be difficult for you to find a mortgage.
Even if you find a mortgage, your interest charges will be high. Lenders will charge you more on the mortgage because they can’t trust you.
If you want to buy a house and have a bad credit score, forget about it. Work on your score first. Once your score is good then think about buying a house. Otherwise, it will be hard for you to find a mortgage and you will pay a ton of interest once you find it.
2. You have other debts and loans such as college loan, car debt, etc
For every loan, you pay the principal plus interest. If you have loans already such as college loans, car loans, etc. consider paying these loans off first before buying a house. Having a house mortgage will increase your monthly payment by a ton. You might end up falling behind on your payments.
To protect yourself from financial troubles, avoid accumulation more debts.
3. You cannot afford rent easily
Are you staying in a rental property and having a hard time finding your rent? If so, you might need to slow down a little on the idea of buying a house.
You could live on a street if you cannot afford a rent and your financial word might be too damaged. On the other hand, if you have a mortgage on a your house, there are two ways out of it. One, you pay it off and be clean. Two, you fail to pay and the house gets taken by your money lender.
Everyone gets happy after paying off a mortgage. However, days are not always bright. There are times when you might not able to payoff your mortgage. Your record will get messed up if you fail to pay off your mortgage.
This is the reason you should avoid buying a house if you are struggling with your rent. Struggling with rent is an indication that you will struggle with your mortgage payments.
Instead of thinking about a house, work on your financial situations.
4. You don’t have a down payment
A down payment is a very important factor when you are buying a house. The money you put down determines what your mortgage will be and how much interest you will be paying on your mortgage. The little you put down, the more your mortgage and interest will be and therefore, the more your monthly payment will be.
If you don’t have a lot of down payment, you can get an FHA. However, it comes with an insurance on top of your mortgage and interest payments. This insurance increases your monthly payments.
The bottom line is, you need to put down as much as you can (at least 20%) to reduce your mortgage and get a better interest on your mortgage. You don’t want to pay $800,000 on a $200,000.
You are not ready to buy a house if you don’t have a down payment.
5. You have unstable life style
This might sound confusing to some people. If you are all over the place especially those who are traveling or randomly leaving their jobs, you should not buy a house. I mean those who quit their jobs for a while to travel or lose their jobs due to their wrong doings.
Buying a house is a commitment that lasts many years. You have to commit to working hard and paying your monthly payment. If you are not ready to do this, it is an indication that you are not ready to buy a house. You don’t want to ruin your entire future for the sake of owning a house. Put yourself together first.
6. You are irresponsible
Why should you be a responsible person before you buy a house? The answer is : irresponsible people are not good for commitments. If you do not understand the weight of having a mortgage or owning a house, you cannot take care of it or pay your monthly payment.
You must be absolutely certain and make it crystal clear to yourself that you can handle every problem that comes with having a mortgage and owning a house.
7. Your future is uncertain
This is a very crucial element when evaluating whether you should buy a house or not. You need to know where you will be 5,10,15 years from now. You need to be certain that you will stay there to fulfill your mortgage responsibilities.
It would not make any sense for your to buy a house with a mortgage and relocate 3 years later. This would create a very difficult situation for you. You would have to sell the house and pay the bank or lease the house and keep paying the mortgage on it.
The point here is: you need to know where you will be in the near future before you decide to make big purchases like a house.
Your house is not a movable asset. Therefore, you should think twice before buying it.
8. You hate dealing with maintenance and repairs
Owning a house does not mean you are the one who will handle repairs. You can have your buddies or contractors take care of many maintenance problems. However, being able to do some repairs here and there on your property can save you money, time, and protect you from frustrations.
Your contractors will not be there whenever you need them. If your toilet or shower stops working in the middle of the night, your contractor will not be there right away.
As a home owner, you need to know how to do minor repairs or major maintenance issues on your house. This gives you a chance to fix problems right after they occur. In the end, you save money and have no delays or frustration from a broken equipment.
9. You don’t have a stable source of income
I hope you are not asking what a stable source of income has to do with you buying a house. Unless you are paying cash, you need a job that will help you pay for your mortgage. If the job you have is a contracted job for few months, you should find a job that is stable. How are you gonna pay your mortgage after your contract is over?
You don’t want to miss any monthly payment on your mortgage. Therefore, you need a secure job that will always be there. Otherwise, you might be testing the dept of water with both feet.
If you don’t have a secure source of income, it is a sign that you are not ready to buy a house.
10. You don’t have an emergency fund and are not saving at all
The emergency fund helps you solve emergency problems such as accidents, leaking roofs, vehicle breakdown, hospital bills, etc. It is vital that everyone has this fund to save themselves when days are not in their favor.
Without this fund, you would end up on street begging people to help you or save you from your misery. How are you going to pay your mortgage if you can’t pay your hospital bills?
This is why you need to work on your emergency fund before buying a house. Some experts estimate that a good emergency fund is the one that can take care of you for six months without adding extra money to it.
You are not ready to buy a house if you don’t have an emergency fund.
11. You have multiple big expenses in your horizon such as a wedding
Weddings take a lot time to plan and a ton of money depending on individuals. You will spend a big chunk of your income on your wedding. If you are expecting the wedding or any other big expenses in your near future, it is important to not move forward with house hunting.
You might not be able to pay your mortgage after using every penny on your wedding. However, you can postpone your wedding and buy a house or postpone the house and have a wedding. Whatever you choose.
Before buying a house, you need to make sure that you have funds that will cover your near term major expenses without affecting your mortgage payments.
12. You will be sacrificing other life necessities
We all know that it is always a sacrifice to undertake the journey of buying a house. However, our sacrifices should have a limit. You don’t want to sacrifice your kids college to buy them a house. You don’t want to feed your kids once a day to buy a house.
Although many people see this point differently; it is important to understand that there are things in life that should not be sacrificed. The choice will be yours.
If you see that you will be sacrificing more than you are supposed to, rethink your priorities.
Maybe it is not the right time for you to buy a house. The house can wait but your life and loved ones’ lives cannot wait.
13. You don’t know the kind of house you want
Some people say, ” I will now the house I want once I see it”. Guess what, you will not be able to see and compare every house in the neighborhood. It will be difficult for you to chose a house if you don’t know what you want.
How do you choose a house to buy if you don’t know the type and design of the house you want? It might take years before you choose one. This will cause a lot of frustrations between you, your family and realtor.
However, you can avoid this issue by doing one thing first. Sit down and decide the house you want. Decide what you want in a house, how many bedrooms, location, bathrooms, levels, square footage, etc.
Once you have this information, it will be very easy for you to find a house. Otherwise, you will be wasting everyone’s time and money.
