Yes. Lenders want to see consistent, provable income, which is much easier with a steady salary than freelance or commission-based work. If you’re planning to leave a corporate job to freelance or start a business, it can be worth buying the home first while your income is easy to document.
Summary
You’re probably going to buy your first home in your twenties, if not early thirties, so you might as well become familiar with the process earlier rather than later. This episode of How To Twenty-Something invites Julia Watkins, Realtor, to break down what exactly goes into buying your first home. We discuss what to look out for, how to handle the inspection, how much money you should have going into this journey, and when the right time to buy is.
Key Takeaways
- Why you don’t want to be “house poor”
- Ways to go about finding a lender and a realtor and when to start this conversation
- Renting vs Owning
- Closing costs, inspections, mortgages, and what you need in your bank account to begin this process
- What is due diligence and how does it play a role in negotiations
- What not to do when you’re about to buy a house
Is it actually cheaper to buy a home than to rent
Long-term, often yes. If your rent is $2,500 a month but a mortgage on a comparable place is $1,800, that gap builds equity instead of disappearing. But you still need to save that difference for repairs, since you no longer have a landlord covering things like a broken HVAC.
How early should I start talking to a realtor if I'm thinking about buying a home?
Way earlier than you think, even if buying is 3-5 years out. Getting ahead of credit score issues or debt-to-income ratio problems takes time, and there’s no commitment in just having the conversation.
Is it harder to buy a home if you're self-employed or 1099?
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