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Summary: This article provides a complete guide for people in their 20s who are considering buying a home in Washington State. The article provides a series of tips, such as building credit, saving cash, doing research, and others, to help future buyers make the right choice.
Buying a house while you’re still in your 20s is an exciting proposition. For most people, your 20s is an era of self-exploration, personal growth, career development, and unpredictability. With the explosion of technology, increased access to education, changing social mores, and other factors, the 20s have become the time to discover who you truly are.
Given that this is the case, the goal of homeownership has been put off for many people in their 20s. This is partly because homeownership involves making yourself stationary, and many people in their 20s prefer to have the ability to pack up and move on a whim. Even though homeownership is being delayed until the 30s for many, some 20-something Americans are still realizing this goal.
In this post, we will provide a complete guide to buying a house in your 20s for those looking for a house in Washington State. We will identify and discuss the key things that people in their 20s should focus on if they want to buy (and keep) a house.
In order to become a homeowner, you’ll have to be sure to have your ducks in a row, so to speak. This means you’ll need to have a stable career, good credit and substantial savings. It also means that you’ll need to do thorough research prior to making your purchase decision. If young Americans in their 20s put in the effort, however, homeownership is a realistic goal.
Related: First Time Home Buyers
To recap, in this guide we will cover the following topics:
- The importance of achieving stability in your career
- The importance of building up your credit
- Why you need to create significant cash savings
- Why you need to carefully research your future home in Washington State
- Why you need to research which mortgage product is right for you
Related: Washington Home Buyers Guide
Achieve Stability in Your Career
Before you consider buying a house, you’ll need to attain a certain level of stability in your career. Career stability is not something every person in his or her 20s can manage. Professional stability can be a difficult thing to come by, particularly in this era.
In general, there is less of a tendency to remain with the same company for a long period of time. This is due both to the attitude of young Americans and the nature of the modern workplace.
In many ways, the modern workplace has become more cutthroat, and businesses are more willing to replace current employees whenever they see a chance to increase profits. Young Americans are more willing to relocate for professional or personal reasons.
Difficult though it may be to attain, professional stability will be necessary if you plan to purchase a house. If you plan to obtain a mortgage loan, you will need to demonstrate career stability as part of the application process. Even if you intended to buy a house with cash, you’ll want to have a stable source of income to service any maintenance or repair costs which will inevitably come up.
Build Up Your Credit
Young Americans in their 20s tend to be less concerned with their credit reports than older Americans. Aspiring homeowners in their 20s will need to buck this trend. If you’re planning on buying a house in your 20s, you’ll want to develop your credit as much as you possibly can.
For 20-somethings planning to obtain a mortgage, good credit will be a necessity. Virtually all mortgage loan providers will want to see at least an average credit score as part of the application process. Better scores can translate into better loan terms, and so there’s a clear incentive to have as high a score as possible.
For those who plan to pay cash, a better credit score will mean better terms in the event that some form of credit ever needs to be obtained at some point in the future. To build up your credit, you may want to consider consulting with an experienced financial advisor who specializes in this area.
Increase Cash Reserves
Along professional stability and credit, another thing you’ll want to do if you’re planning on buying a house in your 20s is save a significant sum of cash. Significant cash savings will be a big positive when you go to apply for a mortgage loan.
Mortgage loan providers strongly prefer to see that a given applicant has significant reserves. Cash savings reassure the loan provider that the mortgage loan won’t go into default if the buyer suffers an unexpected financial setback, such as a job loss. Significant cash savings will also be a benefit for home maintenance and repairs.
When you own a home, you’re responsible for making all of the repairs and doing all of the maintenance. This is one of the big differences when compared with renting. You’ll want to save up a significant sum of cash just in case any substantial unexpected repairs or maintenance costs show up.
Research Your Purchase Carefully
Before you move forward with your decision and buy a property, you’ll want to do copious research, both on the property itself and the area in which it is located. These are both things which might not come easily to people in their 20s.
Many 20-somethings are used to doing things on the fly, but you’ll need to calm down and make carefully informed evaluations if you want to make the right purchase decision. You will want to scout out the right area for you.
Do you want to live in Seattle proper, or one of the neighboring cities, such as Lynnwood or Edmonds? Or do you want to head south, and buy a nice place in Tacoma or Olympia? Again, you’ll want to do thorough research before making a decision.
You’ll also want to very carefully consider the property you buy. Is this house going to meet your long-term needs? Can you handle all of the remodeling requirements? You’ll want to make sure that these and other questions are answered before moving forward.
Figure Out Which Mortgage Product Works for You
Another thing you’ll want to do is conduct adequate research on which type of mortgage product you’d like. Do you need a conventional mortgage loan? FHA loan? VA loan? The mortgage product you select will partly depend on your personal situation. If you’re a veteran, then you may want to take advantage of the VA loan program.
You will also want to conduct research on mortgage rates so you can make sure to receive the best deal possible. If the rate offered by one mortgage loan provider seems too high, you can shop around, or check back later when the market is different. Remember, when you buy a house, it’s a huge decision, and so it’s worth it to take your time and not jump into things hastily.
These are a few of the more important things you’ll want to think about as you consider buying a house in your 20s. The State of Washington is a great place, and an awesome choice to become a homeowner. Cities such as Bellevue, Seattle and Tacoma attract visitors from around the world on a regular basis.
Making this state your home can certainly be a fantastic decision. You’ll want to approach things carefully. And this is where Sammamish Mortgage company can help you.
Reach Out to Sammamish Mortgage
Sammamish Mortgage is a family-owned company which has been in the business of supplying mortgage loans in the Pacific Northwest since 1992. We proudly serve the State of Washington as well as Oregon, Idaho, and Colorado and offer competitive rates and a simple application process for many mortgage programs. If you’d like to learn more, get in touch with us today. You can contact us for more information.