Our 5 Tips to Buying a Home in Your Twenties
Millennials, don’t let housing market horror stories fool you, buying your own dream house can still be a reality. But with all the misleading information out there—from claiming it’s flat out impossible to encouraging you to wait until you’re married with better finances—it’s no surprise to us that you’d be hesitant. Regardless of whether or not you’re flying solo or looking to settle down with your partner, we’ve rounded up our top tips to buying your first house without going broke.
1. Get Your Credit In Order
One of the first hurdles 20-somethings will face when buying a house is getting your mortgage approved. Most in their twenties may have low, no, or bad credit scores. If you’re just starting out, apply for a regular or secured credit card to begin building credit. Already have some established credit? Review a recent credit report and aim to keep your balances 30% or below your limit.
2. Be Confident in Where You Want to Buy
It goes without saying, but we’ll say it just in case: know where you want to settle down. For many, your 20s are the years to travel and see what it’s like to live in a number of different cities, states, and even countries. Those experiences will give you a strong idea of your preferences and lead you in the direction of where you’d like to put down your roots. Go in with a plan, and know that it’ll be a permanent.
3. Get Pre-Qualified for a Mortgage
The house hunting won’t truly begin until you know what you can afford, and that starts with getting pre-approved for a mortgage by a lender, bank, or home lender. There are a lot of resources online that can help you play with numbers to calculate monthly payments, interest rates, and money down.
4. Do Your Research—Lots of It
Loan products, down payments, grant programs, and even the house itself—be sure to research every aspect of the buying process. While there are many programs that assist first-time buyers, there are also loopholes that can lead you in the wrong direction. Look into the neighborhood, consider traffic hours, see what’s in the surrounding areas. Putting in the work ahead of time can make sure that there are no surprises by the time you officially move in.
5. Save Every Chance You Get
There’s a lot on your plate in your twenties, from paying off student loans to starting off with lower salaries. Once you have an idea of what you can afford, it’s important to keep these factors in mind when budgeting for a down payment. Staying focused is key in the saving stage, so consider a few of our ideas to help:
- Type up an honest list of your expenses and make the cuts on extra expenses—even that spin class you think you need
- Create a realistic monthly budget plan that you know you’ll be able to follow, and be sure to leave room for unexpected payments!
- Stay in line with secured money-tracking apps like Mint
- Consider picking up an easy side job like Uber, Lyft, or Wag
Remember, buying a home in your 20s isn’t impossible, but it does require a lot of work. Need help? Feel free to reach out to us with any questions you have about the home buying process.
