Indications that Tell you are Financially fit to Buy a Home

Buying a home is always a dream for us all because there is no place as safe as your roof. The initial concern that occurs to our mind after we commence earning is to get home. But buying a home requires a lot of financial planning and preparation. It is good if you have achieved a level in life where your finances are all set to pay a home loan.  

Mind-boggling on money is necessary for home buying

Most people seek a loan from the bank to buy the house, while some prefer to explore direct lending options. Fin-tech has changed the way we use financial products. Nowadays, some lenders even offer guaranteed loans for the unemployed with no guarantor onlineIt means mortgage to an earning person should not be an issue. People say that there is always a suitable time for everything. It applies to your home buying decision as well. Here you can read about a few indications that tell you are ready to buy a home. 

Higher Credit Score 

A good credit score plays a vital role in getting better financial support from banks. Home buying requires a huge amount of investment, and you might not have enough savings to pay for your home. A good credit score lets you get a good loan from the lender to buy the house. Make sure to pay off all of your existing debts regularly to achieve a good credit score. There are several apps and websites available through which you can check your credit score. 

No multiple debts

How will you invest in a house if you are already drowned in multiple debts? You may have credit card bills or a personal loan to pay off. If you pay a certain amount towards these debts every month, then it is fine. But in the case of many instalments, it may not be possible for you to avail yourself of another huge loan to buy the house. It is best if you have paid off all the debts and do not owe anything. At least have a small size of debt burden. If you can do that, it is an indication that you can buy your dream home now.

Hike in income 

According to the experts, one should not put more than 30% of the income into the mortgage. But most people tend to put around 50% of their earnings towards the mortgage repayment. In such a situation, sometimes, it becomes difficult to manage the day-to-day expenses. If you get a hike in your salary, it will give you more access to the funds and control your costs. This way, you can maintain a good volume of money and registered a new home for yourself.

Stable Job 

You cannot bear the expenses and the mortgage repayments unless you have a steady source of income. With a stable job, things become more accessible, and the financial circumstances also become more predictable. You will be able to clear off all the debts with regular repayments and save a good amount of money. With your steady job, the lender can consider you as a safe profile and offer a good loan to buy the house.

Future Goal planning 

Most people love to plan their finances, and it is always considered a good habit. Planning your finances will help you to focus on the specific goals and start saving for them. If you have already done the financial planning and future goal alignment, it becomes easier to invest in your dream home. Adding your dream home into the planning lets you save a good amount of money for it. 

Savings for a down payment 

If you opt for a loan from the lender, you will need to pay some amount as a down payment from your end. Most of the banks offer up to 80 to 90% of the total value of the home. Hence the balance of 10 to 20% needs to be funded from your end. Each lender or financial institution holds different criteria and terms when it comes to offering a home loan. If you have already saved a good amount of money that can be used as a down payment, this will undoubtedly indicate buying the house.

Ready emergency fund 

Experts always say to save some part of your income for rainy days. Keeping for such purposes is known as an emergency fund. It is suggested to save at least 6 months of expenses as the contingency fund. Saving for an emergency fund will assure you of the security in bad times, and hence you can decide on buying the house without any hassles. This emergency fund will also help you cover the unexpected expenses that can arise while buying the home. There could be certain expenses such as repair or renovation. In this case, the emergency fund comes to the rescue.


Buying a home may look like a complicated process, but you can certainly achieve it with the proper planning. If you notice any of the signs mentioned above or indications, it is the right time for you to buy your dream home.

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