Lots of things are great about being young! However believing nothing bad will happen to you and your inexperience are not. Knowing enough of what you need to get by and being knowledgeable are two different things. The saying common knowledge isn’t always all that common comes to mind when thinking about young people buying homes. So, how to buy a house at a young age? Find an advice for first time home buyers.
Tips for First Time Home Buyers
Things I did not know when buying my first home revolved a lot around how to maintain the home itself. Sure I knew how to clean a house, buy insurance, mow etc. I did not know that there was regular upkeep on home appliances. I would never in a million years have thought I had to do more to my fridge than wipe the inside and outside down with a cleaning wipe and keep food in it cool.
How to Buy a House at a Young Age?
Turns out there is a lot I didn’t know when I was younger about living in my home after I bought it. I bought my first home at 24 with my fiancé. We had rented for 6 years and felt it was time to stop wasting our money on rent and buy into the American Dream of home ownership. We tried working with a realtor, but for whatever reason, possibly our age or unmarried status, we were not taken seriously about buying. We instead drove to neighborhoods that we thought we would like to live in. We found a home contacted the realtor selling the home and asked to come and view the home.
The realtor set a time for us to view the home. It was perfect! Three bedroom, two and half bath, two car garage, it was everything I was looking for! The couple even had the same first names as me and my fiancé and two cats. WE HAD TWO CATS! IT was fate!
The realtor then asked us if we were preapproved. Luckily this was something I already had some knowledge on and we were preapproved. The home was listed for $112,000 and we had been approved for $115,000. Getting the home involved an 80/20 mortgage since we did not have a 20% down payment for the purchase of the home.
Getting approved for the home was a fairly easy process compared to how it is now with more regulations and what not. Two years of tax returns, pay stubs, a review of our credit history etc. We were on our way to homeownership!
SURPRISE Bills! Can Happen to Any Young Homeowner
Things we had no idea we were about to have to pay for outside of our mortgage were going to come up. We were used to some thing being included in our monthly rent that would not be when owning a home. We knew we were going to pay for water, electricity, gas, and have homeowners insurance, but what about trash pick up?!
We had bought a home at the TOP of our budget so finding out we had to pay a monthly expense that we weren’t used to paying for was a rude awakening. I thought I thought of everything when it came to our budget! I was a budget ninja! I balanced the checkbook daily, knew when every bill needed to be paid etc. I failed to know I needed to pay for trash pick up. Living at the top of our budget the extra $25 a month for trash pickup was an unwelcome surprise.
Rainy Day Fund – An Important Advice for First Time Home Buyers
When you buy a home at the top of your budget, building in the rainy day fund it pretty hard to do. I had ‘open credit’ and really that was to be used for the rainy day fund if needed. Living paycheck to paycheck and having open credit on a card for emergencies probably wasn’t the brightest idea.
Sometimes when it rains it pours! A second expense that we hadn’t counted on when we bought our first home rained in on us! Literally, when we had a big rain storm our finished basement ended up with a pool of water in it. Luckily at the time I lived a hop, skip and a jump away from my family and they were able to help. I was able to borrow a shopvac to help get the water out of the carpet and a large blower fan to help dry out the basement. I had never even heard of a vacuum that sucked up water until that day.
Again lucky to have my handy father around he assessed why the rain came into our basement. The grading around the exterior of the home was not right. It needed more of an incline against the home and a lower decline away from the home. WHAT?! Does that event mean? It means we needed to buy dirt to build up next to the home and create an angle downward from the home, creating a way for the water to not run straight down the foundation of the home.
DIRT COST MONEY?!
Apparently something you would think would be free wasn’t. Before the age of Craigslist and Facebook marketplace, people were forced to pay retail for things that now people will give away for free. In order to keep our basement from flooding again we had to BUY dirt?…
After buying dirt, we built up the grading around the bottom of the home using our own two hands, thus saving money on paying some one else to do it for us. If we didn’t have my dad, we would have had to pay for delivery of said dirt as well.
Building Your Budget
I mentioned I was a budget ninja earlier, this was because when we first got our debit cards, we used them all the time. I didn’t balance my checkbook like I should and we ended up paying $35 overdraft fees on stupid things like a $.95 bottle of coke. Coke is good, but not $35 over draft fee good!… So I was overly cautious about our budget and knowing we were able to pay all of our bills on time.
What I didn’t have built into the budget was unexpected expenses. We were fortunate and didn’t have anything go wrong with our home appliances or home systems during the time we had that home. I know we wouldn’t have had the money to fix any of them since we bought a house at the top of our budget.
Things I Would Do Differently as a Young Homeowner
How to buy a house at a young age? I would do a few things differently if I was 24 and buying my first home again. My first advice for first time home buyers is to definitely NOT buy the home at the top of my budget! This makes it impossible to get a head when you do that, especially as a young homeowner. My second advice for first time home buyers is to get a home warranty so that you would be covered if something happened to a home appliance or home system. If I were you, I would make sure the home warranty was one that did not have a service fee, since you are already on a strict budget and may not have had the funds to pay for a service call. My last advice for first time home buyers is to talk to adults who had been adulting longer than you had been to find out about unexpected expenses and how to handle them.