5 Questions to Ask Before Choosing Your First Home

Moving into your own place is exciting, but it pays to be financially prepared! Before you sign a lease or a mortgage, the American Bankers Association (ABA) recommends asking yourself these five quick questions:

• How much is in your savings? You’ll need cash for a down payment (typically 5-20%) or a rental security deposit. Don't forget to keep a 3-6 month emergency fund intact.
• How much debt do you have? Factor in car loans, student loans, and credit cards. Aim to keep your housing costs (plus utilities) under 30% of your gross monthly income.
• What is your credit score? Both landlords and lenders will check your credit. A higher score unlocks better rental approvals and lower mortgage rates.
• Have you budgeted for all costs? Look beyond the base rent or mortgage. Factor in utilities, taxes, insurance, HOA fees, and routine maintenance.
• How long will you stay? Buying makes sense for the long haul so you can build equity. Renting offers flexibility and fewer maintenance costs if you plan to move sooner.

Ready to make a move?
Run your numbers using the ABA's First Home Calculator.

When you are ready to explore your home financing options, Traditional Bank is here to help! Click here to get in contact with your local lender, and we'll be happy to assist you on this exciting journey.