How to Buy a House When You’re Single
Buying a house can seem like a lofty goal for renters, especially if you’re single. However, with careful planning and making use of all available resources, you can accomplish your dream of being a homeowner on your own. Follow the advice below to take the first step towards your first home.
A Guide to Home Buying for Single People
How Can You Budget Realistically?
The biggest obstacle renters face is saving enough for a down payment. It can be challenging to put aside money when a good chunk of your paycheck goes towards rent and other living expenses, but if you have a stable job and steady income, smart budgeting is possible.
In all likelihood, you’ll need to make some sacrifices. If you were thinking of getting the latest smartphone or laptop, consider putting it off, if possible. Likewise, try to hold onto your current vehicle as long as you can. Other areas you can cut back on include concerts, sporting events, theater tickets, and streaming services.
Commit to setting aside a certain percentage of every paycheck. To do this effectively, you’ll need to know how much you should save. Most people rely on a mortgage to buy a house, so in this case, your savings will be going towards a down payment, closing costs, and emergencies.
What Are Some Obstacles You May Face?
Being a single buyer comes with unique hurdles, but every problem has a solution. Here are some issues you might face and how you can overcome them:
Down Payments:
Saving up for a down payment can seem unmanageable for a single income, but there are different programs you can look into. For example, a Federal Housing Administration (FHA) loan is ideal for single and low-income buyers. These offer lower down payment options and more lenient credit requirements.
Debts:
It can be difficult to get a mortgage on a single income when you have a significant amount of debt. Focus on paying off student loans, credit card debt, auto loans, and anything else you owe. The lower your debt-to-income ratio, the more trustworthy you are to lenders, which may mean a lower interest rate.
Approval:
Single home buyers sometimes have trouble getting approved for a loan. Having a co-signer may improve your chances of eligibility. It is important to note that this co-signer will also become responsible for the loan, meaning if you miss a payment, it will affect their credit in addition to yours. They must also take on the burden of the mortgage if you stop paying altogether. Because it is a significant risk, co-signers are typically close family members.
When you’re ready to buy a house for the first time, turn to REthink Luxury. Located in Chattanooga, TN, and serving the Hamilton County area, this real estate agency goes above and beyond to make the home buying process as stress-free as possible. Their experienced team will walk you through all of your options, find a listing that meets your needs and get you the best deal. Browse the current listing online or call (423) 653-0705 to discuss your vision with a real estate agent.
