At Members Plus Credit Union, we understand that buying a home is a big deal. We also understand that buying a home on a single income - whether by choice or circumstance - can feel overwhelming. With the right planning, it is absolutely possible, and we are here to help guide you through the process of homeownership with this guide to navigating the home buying process solo. From smart budgeting and making the right mortgage selection to financial preparation and lender support – buying a home on a single income is easier than you may think. Here’s what you need to know.
Know Your Financial Starting Point
The first step in the home buying process is to check your credit score and analyze your debt-to-income ratio to determine how much you can afford to budget for a mortgage payment. This needs to be done before you even begin your home search because you need to know how much you can afford to spend on the home. Getting pre-qualified before home shopping is necessary to know exactly how much house you can realistically afford based on one income. In fact, many real estate agents won’t even show you homes for sale until you have a letter from a lender indicating you are qualified to purchase a home to make sure you are not both wasting your time looking at properties you can’t afford to buy.
Explore Mortgage Options That Support Single-Income Buyers
There are a variety of mortgage loan types that are a great choice for buying a home on a single income. MPCU offers mortgage options that are designed to support buyers in various financial situations, such as first-time buyer programs with low down payment requirements and rate discounts. The experienced mortgage professionals at Members Plus are here to help you choose the perfect type of loan for your home purchase and get you prequalified to start house hunting!
Choose a Lender That Works with You
The most important decision you must make when buying a home, besides choosing the actual home, is to select the lender for your home mortgage. Working with a lender like Members Plus Credit Union that understands the unique challenges of single income buying is key. It is important to understand your options and to ask important questions like flexible underwriting possibilities, lower down payment options, and assistance with budgeting or credit building to ensure you get the best deal possible when buying a home on your own.
Prepare for Trade-Offs
It’s also a good idea to educate yourself and be aware that buying a home on one income may require some compromise. Because the loan is dependent on your income only, it is a smart choice to focus on your needs vs wants. Making smart choices including home size, location, or amenities allows you to prioritize long-term value and stability over short-term “nice-to-haves” which could mean the difference between buying a home and having to continue to rent.
Plan for Hidden and Future Costs
When budgeting for a home, it is important to remember that the monthly mortgage payment is just one part of homeownership costs. It is important to plan for hidden and future costs that include property taxes, homeowners’ insurance, maintenance, and utilities. In fact, it is a smart money move to build an emergency fund to manage unexpected home expenses so that an untimely home repair doesn’t put you in a financial situation you can’t afford.
Build a Trusted Support Team
When buying a home, solo buyers should lean on experienced professionals, including their real estate agent, loan officer, and even a trusted financial advisor to help guide the decision-making. Even though you are buying a home on your own, that doesn’t mean that you have to go through the process alone. Having a professional home buying team you can trust and count on for guidance is a smart choice to ensure you get the best type of loan and find the perfect home!
MPCU Is Here to Help You Buy a Home on a Single Income
With the right planning and preparation, buying a home on a single income is definitely achievable. When you work with a trusted lending partner like MPCU, you can rest assured you are in good hands with professionals that will help you make the best choices for your home purchase and your future financial success. We invite you to explore mortgage options and support services at MPCU for your solo home purchase so you can stop wasting money on rent and begin to build equity in a home of your own. Contact MPCU today to get pre-qualified for your solo home purchase.
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