Buying a home sight unseen might seem like a massive gamble: plunking down hundreds of thousands (maybe millions) of dollars on a property you’ve never set foot in, your fingers crossed it looks just like the photos and doesn’t have major issues! So how lucky do you feel, anyway?
The coronavirus pandemic has led to record-high unemployment rates not seen since the Great Depression. And this is particularly worrisome for would-be home buyers.
If you were among the 23.1 million Americans who were laid off or furloughed, you might be worried about your financial future. And if you were hoping to buy a house—either now or in the next few years—you might also wonder how your current jobless status might affect those plans.
While the situation might seem dire, unemployment does not mean that home-buying plans have to be put on hold for long.
The gig economy has blown up in the past few years, with more and more people choosing to work as freelancers, either by starting their own businesses, or by picking up nonsalaried jobs from bigger companies.
According to the Freelancers Union, over 50 million Americans worked this year as freelancers, a number that represents roughly 35% of the country’s workforce.
While freelancing undoubtedly has its perks, helping you get a mortgage is not one of them. Since COVID-19 started tearing through the country in March, we’ve heard reports of freelancers having an even harder time getting approved for mortgages.
If the dream of owning a home is on your bucket list, you’ve likely combed through listings, narrowed down your home preferences, and even attended a few open houses. But while you might be mentally ready to buy a home, your financial situation might tell a different story.
“Renters who are ready for homeownership should have their financial house in order before contemplating a purchase,” says Ben Creamer, co-founder and managing broker of Downtown Realty Company in Chicago. “I tell my clients to approach buying a home as they would for their job—it requires planning, diligence, and structure to be successful.”
There are a number of monetary factors that can rule you in—or out—as a viable candidate for a mortgage. Here are some signs you’re not ready to be a homeowner.