If you’re thinking about becoming a homeowner for the first time I don’t have to tell you all the great reasons to buy.  There are tons of great reasons and you’ve already been bombarded with them.  If you live in greater Lansing you’ve seen INNW ads all over.  Everywhere you look you’re being steered toward buying a home and it’s easy to get caught up in the excitement.  Maybe you just got married and buying a house together seems like what you’re supposed to do next.  Maybe you just graduated from college and got your first “grown-up” job and you want to take another “grown-up” step.  Whatever your reason, buying your first home is an exhilarating process and it’s easy to get caught up in the excitement. So my advice – in the process make sure you take some time to seriously consider not buying a house.

You didn’t expect me to say that did you?  I’ll say it again.  Consider not buying a house.  I say this partly for a selfish reason.  I never want to get a call from a client who has buyer’s remorse or worse.  Seriously though, there are always times when buying a house is not the right step.

Here are five cases when I’d urge you to hold off on buying a house:

1. When your job might not be your job for much longer.

If you’re not independently wealthy you need a job to bring home the bacon.  If you can’t count on keeping your job, wait to take on a mortgage until you have a position that’s reliable.

Also, if you don’t like your job you might want to consider waiting to buy a home.  You don’t want to end up stuck in a job you hate because you can’t afford your mortgage if you quit.

2. When you have bad credit.

When you take on a mortgage, your lender charges you interest every month.  When you have a low FICO score your lender charges you a lot of interest every month.  I know what you’re thinking, “I’ll just take out the mortgage now and I’ll refinance for a better interest rate once I clean up my credit.”  Maybe you are the person who can do that, but in reality becoming a homeowner doesn’t magically make people more responsible with credit.  I think you should seriously consider taking on the responsibility of fixing your credit before you buy.

3. When you already have major debt.

If you’re already bogged down by debt taking on a mortgage payment might not be wise.  I know you’ve been inundated with real estate professionals asking you “why rent when you can own?” and usually I’d be the one doing the asking, but if you have major credit card debt, loans, unpaid bills etc. you should keep renting a cheap place until you can get all or most of your debt paid off.  Owning a home is expensive and it can be easy to crumble under the pressure of debt.  That’s why you’re seeing so many homes being foreclosed on.  You don’t want that to be your house.

4. When the only way you can afford a house is by using a non-traditional mortgage.

Here’s a wake up call – If you can’t afford the monthly payment on a house using a traditional 30 year fixed mortgage you can’t really afford the house.  Interest only loans, 3 year ARMs and other non-traditional mortgages seem like the perfect solution.  You’ll get you into your dream house immediately instead of having to “suffer” through owning a starter home.  But like anything else, if it seems too good to be true it probably is. Very few people are disciplined enough to use exotic mortgage products.  What happens if something unanticipated happens?  What happens if you need to sell unexpectedly and you have no equity in your home?  I’ll tell you what happens – you lose your house and ruin your credit in the process.

Be honest with yourself about what you can afford and don’t be tempted by non-traditional mortgage options.

5. When your mortgage payment is more than you can comfortably afford each month.

You’re not alone – everybody wants a bigger, better house than they can afford.  I want more square footage, granite counter tops and stainless steel appliances, but I don’t want a mortgage I can’t afford. I know you’ll probably get a raise soon.  But what if you don’t?  Either buy a less expensive home so you can afford groceries every month or wait until your raise becomes a reality and then buy the bigger, better place.

Common wisdom says you’re housing costs should never exceed 33% of your monthly income. I think you should try to keep it under 28%.  And remember, just because a lender tells you that you qualify for the bigger, better mortgage doesn’t mean you can afford it.

Only you know if the time is right for you to buy. I just want you to think about it seriously.