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Your Money, Your Life: Is Now the Time to Buy a Home?
Mar 20, 2014 | 10513 views | 0 0 comments | 905 905 recommendations | email to a friend | print
Don Milne
Financial Literacy Manager, Zions Bank
Don Milne Financial Literacy Manager, Zions Bank

By Don Milne

Financial Literacy Manager Zions Bank

If you’ve felt cooped up in your apartment during the winter, spring is coming, but it’s hard to take full advantage of the season on your small balcony. Perhaps you look enviously to your friends who have homes where they can enjoy their gardens and patios. Is now the time to take the plunge and buy that house?

Here are 5 steps you can take to help you make this decision.

  1. 1.Are you planning to be around for more than a couple of years? If the answer is no, then you are probably better off staying in your apartment or renting a house. It usually costs an extra 2-3% of the sales price for loan closing costs when you buy a house and another possible 3-6% in sales costs when you sell the house. Also, while in the long term home values usually go up, we all know from recent events that in the short term sometimes home values can go down. You don’t want to be caught with a home you can’t sell to pay off your mortgage if you need to move.
  2. 2.Are you planning to keep this home, or is it a starter home that you will sell at later time?  If this is your dream home and you don’t foresee moving, consider financing your purchase with a 15-year mortgage.  You should be able to get a lower interest rate, and on an average priced home you could save up to $100,000 or more in lower interest payments. Your payment will be about 20 percent higher, but after 15 years, you’ll have no more mortgage payments instead of just getting halfway there. On the flip side, if you plan on moving, a 30-year mortgage may be a better option. This will let you buy a more expensive home which will hopefully appreciate more by the time you are ready to sell.
  3. 3.Should I get preapproved by lining up my mortgage financing before I start looking for a home? Michele Weaver, who manages the Zions Bank Homeowner’s Café, a free resource for home buyers, says, “Getting preapproved demonstrates to sellers that you are a serious buyer and you have taken the necessary steps to begin the home buying process. It encourages a seller to consider your offer seriously. Getting preapproved may also make the process smoother and quicker once you’ve found the home of your choice.”  
  4. 4.How do I pick a good real estate agent? Michele says, “When interviewing real estate agents you should remember they work for you. Do not be afraid to ask for referrals and best practices. One realtor’s communication method and work style may be very different than another, and it’s important to hire an agent who can provide you the service that you expect. It can mean the difference between a pleasant and an unpleasant buying experience.”
  5. 5.Can you handle homeownership if you have a job loss? If you are renting at the time of a job loss, it may be easier to move to find a lower rent (or maybe live free with family for a while) than if you own a home. Make sure you have an emergency fund to cover your mortgage payments for a few months until you get back on your feet.

For more free resources with help for new home buyers, visit

There are many benefits to homeownership and mortgage rates are still near historic lows. If you make adequate preparations you will be on your way  to move into your home, sweet, home.

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