Below are given the points or top ten reasons which can stop you to buy a home or can avoid you purchase a home, and any one of them can be a reason that you can't buy a home.
If you are thinking to buy a new home for yourself or thinking whether you are a candidate for the ownership of the home, you should understand that this depends on many factors, some are less important, and some carry more weight than others. You can only decide which of these factors are having the greater impact on you while buying the home.
If one of any following condition arises you can still purchase the home but more that will be the signal which should be taken seriously before making to buy the home. You don't want yourself into the situation where you won't be able to purchase a home for you.
Here Are The Ten Reasons Which Can Stop You To Buy A Home
#1. You Are Not Having Finances For Making Down Payment
You will need to make down payments to buy home, the first-time home buyer programs and VA loans are not included in it. The amount of down payment can be about 3.5% of the sale price for FHA loan to a minimum of 10% for the conventional loan. If you are making a greater down payment, than that like if you are making up to 20% of the down payment, you will be offered the best interest rates.
#2. You Have A Bad Credit
Having a bad is the biggest hurdle in your home buying process. If you have bad credit, you are most likely to get disqualified from the mortgage. The people who are having their credit scores below 620 will find it very difficult to have lending sources for them. And in case if you locate the lending sources the interest will be very high. If you have a borderline credit, you can wait for some time can make changes in your financial habits so that you can have updated FICO score.
#3. You have A High Debt Ratios
The debt ratio rules are always get updated and changed by the lenders. In can your monthly bills take up to 50% of your income then probably you won't be able to afford the payments required for the mortgages on top of those expenses. After the mortgage meltdown in 2007, the lender's guidelines have also changed, and it is imperative that your debt ratio should be meager. You should always consider paying your credit card bills or any other debt before buying a home.
#4. You Have Little Job Security
If you think that you do not have a secure job or your job is in jeopardy, you should not opt to buy a home. It is seen that many homeowners who have chosen for foreclosing have ended up in a situation where they have lost their jobs. Most of the unemployed individuals will like to pay their gas bills and other groceries than paying for the mortgage. They use to think that they can have mortgage payments later and this leads them to get into debt.
#5. If Renting Is 50% Cheaper
If your main idea is to have a roof over your head, then you can also consider renting over home buying. In some areas of real estate markets, it can be little bit harder obligations to have the home ownership than to have the renting, as rent in those areas are about 50% lower than the mortgage payments.
If the real estate market prices rise in that situation, also you can opt to have a renting for yourself and can pay less to have a roof over your head.
#6. You Tend To Move Every Year
Buying a home is firm and long-term commitment. If you love to travel the places and get excited for new digs, which are making you regularly to change your location and environment, then it will be challenging for you to sell your new home in a short period. The most of the people opt to buy the home is to build equity, and if you use to buy and sell at the drop of a hat, then it will be difficult for you to build equity.
#7. Decline In Real Estate Market
Most of the people avoid buying the home if the real estate market is falling as their investment will disappear if the market continues to fall. In the simple sense home buying in declining market means if you have invested about 10% and the market falls another 10%, then you have now lost about 20% of the investment. The only way it makes sense in buying a falling market is that if you buy it below the comparable sales.
#8. If You Are A Constant Traveler
If you're into the job, which requires lot more travel, then why you would like to buy a home. Some people will advise having a condo, as it is considered as the lock & go lifestyle. But if you opt to do so who will pay your monthly homeowner association fees, and it will be just a huge wastage of the money.
#9. You have Unstable Relationships
It is evident that many single man and women use to buy the home, but most of the time people use to buy homes with their partner or spouse.
In case you are having the unstable relationship with that person, and you are relying on their monthly income so that you can manage to pay the mortgage and suddenly the person vanishes then you will be in a vicious circle. At that time you will opt for the short sale or modification in the loan, but in both of the conditions, it will affect your credit.
#10. If Everyone Is Doing It
If you buy home in seller's market, you will do very less in negotiation, as a vendor must be having many options and offers. You should always opt to buy the home in buyer's market where there is less competition for the inventory. You should follow your instincts and no need to follow the crowd to make the smart financial decision.