There’s no time like the present to buy a house. After all, even though a new home brings an extraordinary expense, it’s also a good value over the long run. Every month you’re living in your own place means another month you don’t have to rent, which means you’re adding to your long-term net worth rather than paying off someone else’s home loan. The sooner you buy, the sooner you can begin accumulating wealth.
Having said that, a mortgage is a big commitment. Is it one you’re ready to make? This decision should hinge on a lot of key financial factors.
Are you financially secure long-term?
You might think that now is the right time to start borrowing money for a house, but that’s not an easy call to make. You’ve got to look at the big picture first. You might have a well-paying job now, but will that still be the case 10 or 20 years from now? Making mortgage repayments requires long-term stability.
Everyone knows to look at their credit report and assess their financial health before making a big purchase, but not enough people know to consider the long-term outlook. How are their finances trending in the big picture? What will the future look like? With a long mortgage, this is equally important.
Can you borrow without undue stress?
The goal is to fit your mortgage comfortably into your life. For some people, even if they have low-interest loans, this isn’t easy. A Mortgage Choice survey of first home buyers found that 53 per cent of Australians are above the “stress threshold” for paying off their mortgage, meaning it takes more than 30 per cent of their income after taxes.
Spending this much leaves a dangerously low amount for other expenses, which will probably impact your quality of life. Are you able to pay off a mortgage without courting extra stress?
Find a mortgage you’ll be comfortable with
Many Australians struggle to get home loans they can afford. To avoid this problem yourself, it’s best to contact us so we can find you a great deal. Talk to us today about how we can work our magic for you.