Whenever there is a global financial crisis of any kind, you know that it’s more important than ever to make smart financial decisions as a future first time home buyer. Being intelligent about money management in a time of crisis can help set you up to make big life moves, such as purchasing your future home.
To simplify this process of saving, we’ve put together some of our favorite tips as a top mortgage lender to help home buyers in the early stages of their journey. Dodging the financial mistakes being made during the COVID-19 crisis is not only an investment in your present but your future as well.
Setting up Your Plan
When there is a financial crisis in play, whether it be from a pandemic, economic downturn, or any other uncontrollable event, you want to have a plan in place to address the potential fallout head-on. The plan needs to begin with an assessment of your current financial standing.
You and your family should sit down and take an honest look at your finances.
- What is the money you have coming in, and how does it compare against your monthly expenses?
- What is the state of your savings account? Do you have a savings buffer?
- How is job security looking family-wide?
All of these factors are areas of consideration to take into account when considering any of your moves for the future.
As you work through the assessment, the end result needs to be a budget. Having financial goals in mind along the way is also critical: if you are planning to buy a home following the current crisis, working towards paying down debt. This will boost your credit and help you build more savings—not only to act as a buffer in the event of joblessness, but to put towards your future down payment.
That said, affordable down payments are within reach when you work with a top mortgage lender. Not everyone has 20% to put down on a home—especially during a financial crisis; having some wiggle room helps. You also want a lender that can help you fund your home fast with FHA home loans, or VA home loans, or some other type of unique arrangement that works best for you.
Invest in a Safe and Smart Way
Investments are something you can rely on during a crisis when you use them as wealth-development vehicles in a safe and smart way.
- You want to avoid risky stock purchases during a crisis.
- You also want to avoid any type of extensive volatility.
- There are many sound, safe options which you can rely on.
One option to consider is a money market account with your local bank that can net you financial gains in the form of interest income. While the income will not be massive, it is safe—and you know your base savings will be right where you need them.
While investing is not a priority, having secure, alternative forms of income are worth diving into as part of your future financial picture when other debts and expenses are squared away. If a crisis of this magnitude ever occurs in the future, you’ll have something additional to pad your savings.
Avoiding Major Financial Moves
During a crisis of any kind, you want to avoid major financial moves. If you are a first time home buyer actively working towards your new home and taking out a mortgage, a crisis is a time where stability is pivotal. As a top mortgage lender, we want to emphasize that knowing your financial foundation is sound and will continue to be stable throughout whatever transpires is protection for your financial future.
If you have the urge to make major purchases like buying a car, appliances, or expensive furniture, fight that urge until the crisis comes to an end. The last thing you want to do is deplete your savings extensively—and put yourself in the red before reaching that ultimate goal.
In addition, avoiding additional debt during this time will protect your credit in the event that your savings run dry—and you’re forced to turn to alternative lines of payment to cover your debts. Preventing this from the start will preserve your credit, and having your credit in good standing will help you when the crisis is over.
What is the end goal you have in mind coming out of the crisis? The end goal needs to be what you are marching towards when you set up your plan, avoid those big financial moves, and invest in a smart and safe way. The end goal for many will be the eventual purchasing of their new home as a first time home buyer. Having your ducks in a row when it comes to your credit is what helps make your move forward possible.
Work With Top Mortgage Lenders You Can Trust
One of the biggest pieces of the equation if you want to move forward as a first time home buyer is to work with lenders you can trust. There are plenty of lenders out there looking to take advantage of any crisis, offering loans with high-interest rates and terms unfavorable to you.
Work with only the best mortgage lender, one that gives you terms you can appreciate—and helps you get from here to home sooner. Having a lender that is a reliable resource through your home-buying journey is the finishing touch of the equation, providing you reliable information each step.
The HomeSoon Lending Team is the partner you need as a first time home buyer! We know how to work with you and your budget in any kind of economic climate, and we can walk you through the various mortgage opportunities that might fit you best. It all starts by getting in touch with one of our top loan officers!