Financial Advice For Women Diving Into The Home Buying Market

Dated: 02/07/2020

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Financial Advice for Women Diving into the Homebuying Market

Are you ready to take the plunge? Single women now make up a substantial portion of homebuyers. If you’re one of the many women considering a home purchase, here is important financial advice to set you up for success.  

Good Reasons

There are many reasons single women decide to buy homes, and according to some statistics, they make up more than 20 percent of homebuyers. They want their own space, are ready for either a larger or smaller home, or are moving closer to family members, their jobs, or school. If that sounds all too familiar, there is good news. While experts at Time admit the homebuying process is daunting for singles, there are special programs for which you might qualify.  

Know Your Numbers

Before jumping into the pool, you should assess your finances. You’ll need to calculate your monthly income, list your expenses, and then reduce your income by your expenses. Tally your home-related costs so you know what you’re currently spending on your rent or mortgage, utilities, and the like. You may wish to use a home affordability calculator to help with budgeting. Remember, homeownership involves routine repairs and maintenance, so spending less on your mortgage to allow for more breathing room in your budget is usually a good idea. If the numbers you come up with don’t look promising, consider other ways to fund your housing dream. Agent Julie Gans told Marketwatch that single women should look into a guarantor, co-purchaser, or someone willing to gift or loan the money. Finding the right [property] that will allow these options are important and help women and single income families be successful in their purchases,” Gans said.

Research the Market

Once you have an idea of what you can afford, you should begin researching the average listing price of homes in your desired area. For instance, homes in Woodcliff Lake have an average price of $685,000. The more educated you are about what’s available, the easier it will be to know when you find “the one.” You should make some notes of must-haves in your future dwelling, desirable traits, and then a wish list. The more information you have at your fingertips, the easier your search will be. However, open your mind to each home’s potential. HGTV interviewed women who have gone solo and bought a home, and Kahshanna Evans found that the best way to beat the market was to start basic and upgrade later. “Don’t start with pricey flooring or bells and whistles in an unstable market. Go simple and chic until time to upgrade and be open to the magic,” Evans said.

Getting a Mortgage

You should understand the mortgage loan process before you apply for one. When you apply for a mortgage you will be seeking a pre-approval letter. A lender will look at a number of supporting documents for pre-approval, such as your proof of income, proof of employment, and credit rating. Your income and credit rating are related and affect your loan amount and interest rate. You can improve your credit score with a higher income, lowering your debt, or lowering credit card balances, or a combination of those tactics.  

FHA Loans are a Good Choice

An FHA loan is an advisable choice for women flying solo. These loans offer lower interest rates and the qualifying credit score is lower, meaning it’s easier to get with a single income. If you did not own a home in the last three years, you can make a down payment as low as 3.5 percent. Using an FHA loan also qualifies you for the HAWK program, which means you can get a lower rate on your mortgage insurance.  

Other Funding Options

If you owned a home within the last three years, you should discuss your situation with individual lenders. There are conventional mortgage options with lower down payments or other reduced costs, depending on your situation. Other mortgage options to explore include a VA loan, a USDA loan, an Energy-Efficient Mortgage (EEM), and local grants and programs.  

Mutually Owned Property

If you’re leaving a situation where you own property with a (now) ex, NOLO recommends carefully reviewing any related paperwork. Organize all your important documents and store valuable assets in a safe place. Whatever your circumstances, it’s in everyone’s best interest to try to communicate. Even if you don’t see eye-to-eye on some things, the process will be smoother if you can coordinate it together. When moving day comes, make sure you have help with you. With friends or family along, you’ll feel more supported through both the physical and emotional burden of moving. Besides, the more hands and backs that are involved, the faster the work will go.  

Into the Pool!

Do some research before diving into the homebuying market. Know what you can afford, evaluate your priorities and explore the kinds of loans you can get. With proper preparations you’ll do swimmingly! 

Suzie Wilson

Editor, HappierHome

Disclaimer: We are not accountants nor attorneys. It is always recommended that before making any financial decision that you seek out the advice of a licensed professional tax accountant and attorney. 

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D.J. Ten Hoeve

Hey there! I'm D.J. Ten Hoeve. I work with builders, buyers, homeowners, renters and investors in Central New Jersey (Monmouth, Middlesex and Ocean Counties) who want to sell over asking price, f....

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