Of the more than 200 million adults in the United States, about 50% say they make New Year’s resolutions. That’s about 100 million health, self-improvement, family, and career goals set at the beginning of every year. Many also make goals related to homeownership, whether that means saving up for a home, closing on a home sale, or beautifying (maybe even adding some value to) a home they already own.
Research also shows that of the 50% who make New Year’s resolutions, only 10% keep them for more than a few months. We understand: Sticking to goals can be difficult, especially when the world is so full of unknowns. Large goals in particular — like those related to homeownership — can be intimidating, and seem too big to possibly tackle.
We’re here to tell you that while it may seem tough to stand by your homeownership resolutions, some good old-fashioned discipline, list-making, and stick-to-itiveness can divide those big goals up into bite-sized chunks. Regardless of whether you’re a current homeowner or are hoping to become a homeowner, we’ve come up with a few New Year’s resolutions to add to your list, along with some tips for helping you stick to them through March and beyond.
People looking to become homeowners usually know about down payments — that they constitute some portion of the home’s total cost. For sure, saving up for a down payment is a hugely important step in the homebuying process, but there are many other costs to consider before you get serious about buying a home.
Homebuyer Resolution #1: I will become an expert budgeter.
Affording a home means much more than being able to afford a down payment. While your down payment will likely be the single biggest lump-sum cash outflow to consider, you’ll also need to think about regular utilities and maintenance costs, inspection fees, monthly mortgage payments, insurance payments, property taxes, and more.
Also, be sure you have a full comprehension of your financial situation. Either spend some time on your own or work with a professional advisor to map out your current finances, your future finances, and what steps you need to take to be able to invest successfully in a home.
To help boost your financial confidence (as well as your down payment fund), get really serious about what you’re spending and why. Get thrifty. Maybe turn the thermostat down a few ticks — especially at night, when your bedsheets are your primary heating system (even if it means calling a peace conference to put an end to thermostat warfare, we promise it’ll be worth it). Cook at home one or two more nights per week. Start automatically depositing a portion of your paycheck into a savings account. A little bit every day goes a long way toward being able to afford your dream house.
Homebuyer Resolution #2: I will have exceptional credit.
Having a good credit score is hugely important throughout the homebuying and homeownership processes. When preparing to buy a home, you’ll want to get pre-approved for a mortgage, which means a financial institution surveys your financial health and establishes a range of mortgages that you can afford.
During the pre-approval process, credit score is a factor they weigh heavily (you can get a good, free estimate of your score using FICO). You’ll want to check it thoroughly to make sure there’s not outdated or incorrect information included that would adversely affect your score. In order to be able to afford the kind of home that you want, make sure your bills and other payments are completely up to date. Reduce the balance on credit cards you own, and don’t open any new lines of credit in advance of buying a home. There’s a lot that goes into getting a perfect score.
Homebuyer Resolution #3: I will be as informed and organized as possible.
Having a successful homebuying process means that the house you choose to live in actually suits you. Think hard about the kind of home that will serve you, that will make you and your family happiest. This will help guide the early stages of your research and will help you make smart decisions along the way.
Then, figure out what documentation you’ll need to keep handy, and keep it all organized and in one place. While looking for a home, you’ll need to provide income statements, employment history, asset lists, tax information, and more. Locating these documents early, making copies, and keeping them close at hand will ensure that all information is both accessible and consistent throughout your homebuying process.
Homeownership is a gigantic responsibility, and so it behooves homeowners to make sure their homes are as sturdy, clean, and organized as they can be. During the months we’re all still spending at home, think about ways to make the most of your home.
Homeowner Resolution #1: I will put my home in the best possible financial situation.
What if we told you it might make sense for you to actually make larger mortgage payments? Sounds strange, maybe, but larger payments can both shorten the term of the loan and reduce the overall amount paid back over the course of the loan. If you happen to be in a more comfortable financial situation than the last time you reviewed the terms of your mortgage, higher mortgage payments could make sense for you.
Also, take this opportunity to review your homeowner’s insurance to make sure you’re getting the biggest possible bang for your buck. If you’re in any doubt, shop around to see if there are better deals out there. Did your thoughtful spouse give you a pricey gift over the holidays? Did you finally replace that old, creaky furniture with a roomful of fancy stuff? Any new, expensive items that your old insurance didn’t cover means it’s time to shop around and make sure it’s covered.
Finally, if you haven’t already, look into refinancing. 2020 was a huge year for refinancing, as historically low interest rates made it a compelling option for many homeowners. With interest rates remaining low, 2021 could be your year.
Homeowner Resolution #2: I will make my house as sturdy and clean as the day I moved in.
Some home maintenance areas to consider:
- Check air filters. More people (and pets) indoors more of the time can put a strain on air filters. Make a habit of checking your furnace filter once a month — if you can’t see through it clearly when you shine a light, it could be due for a change.
- Look for cracks. Survey your home’s foundation for cracks, which pests like rats and mice use to crash holiday parties. If you see cracks, use caulk to fill them in and keep pests out.
- Check smoke detectors. Smoke detectors should be replaced about 10 years from the date of manufacture. Check your smoke detectors to make sure they’re still inside this window — and once you do, put in some fresh batteries.
- Carbon Monoxide/Radon Tests. Do you have carbon monoxide detectors installed on every floor? When was the last time you or a professional performed a radon check? You are what you breathe, after all.
- Test your soil and/or water. Particularly if your house is new, and if you have gardening aspirations, soil testing kits can give you a sense of what nutrients your soil is lacking. Water testing kits will ensure that your water is free of things like lead and bacteria. Soil and water tests can be performed either with DIY kits, or by hiring professionals.
- Clutter happens naturally — everyone has a junk drawer, or possibly a junk room, where old chargers, toys, and remote controls live out their retirement years. Maybe enlist your family’s help in going around the house and cleaning out whatever you no longer need. While you’re at it, get out the cleaning supplies and clean areas as you declutter them. Why should spring cleanings get to have all the fun?
Homeowner Resolution #3: I will raise my home’s value.
Curb appeal — how good (or not so good) your home’s exterior looks to passersby/potential buyers — has a huge impact on your home’s total value. Studies have shown that homes with high curb appeal tend to sell for 7% more than homes with unappealing exteriors. This year, even if selling isn’t on your immediate horizon, commit to tackling a few curb appeal projects.
Additionally, consider steps to reduce your carbon footprint. Besides being good for the planet, energy efficiency can also mean reduced utility bills, and increased home value if and when you choose to sell. For those inclined to take on the eco-friendly projects, consider composting food, replacing incandescent bulbs with LED bulbs, installing programmable thermostats, insulating and sealing the house, putting in drought-tolerant landscaping, and more.
Happier & Healthier
A new year is a time for reflection, a chance to review challenges overcome, stress endured, and the people who helped us through it all. As we celebrate the end of this pandemically-challenged year and look forward to what’s next, we should all be as intentional as possible about moving forward happily. Setting clear homeownership goals will help you make the most of the fresh calendar year. Home is truly where the heart is — and if the home is happy, the heart is happy.
By Authors for The Money Source, 1/12/2021
Original Article HERE
For more information, please contact us here.