Grace moved to Atlanta with her dog soon after graduating college in 2018, and she rented apartments until now. Recently, she and her best-friend-turned-roommate, Griffen, purchased their first home together. Here, she shares some of the steps they took on their homebuying journey and lessons learned along the way.
Homeownership has always been a goal of mine, and luckily, it’s been one of Griffen’s, too. After our landlord increased our rent, we used a mortgage calculator and determined we could pay just $80 more monthly for a mortgage than for our rent. Seriously—$40 more for each of us for three times the space and we’d have equity? That seemed like a no-brainer for us.
Fortunately, we’d both been saving money for a while, which helped us compete in the hot Atlanta housing market. But having money in the bank isn’t the only thing that’s important when you’re looking to buy a home. Here are some of the crucial steps we took to become homeowners, along with tips that can help make your own homebuying journey a little smoother.
1. Deciding to buy a home together
Buying a house is a huge investment, and Griffen and I needed to make sure we were on the same page. It’s one thing to buy a house with a partner or spouse—buying a house with someone to whom you have no legal obligation is a whole other ball game.
Before signing both of our names on a mortgage loan, we had to have some big conversations—ones about finances, responsibilities, and managing expectations. We asked questions like:
- Do we split our finances unequally to get a house we want? Are we comfortable with that?
- Do we go 50/50, even if it means missing out on a more expensive house we love?
- What happens if we buy a house, and one of us moves out a few years later?
Having these conversations—although tough at times—ultimately made us feel more confident in our decision to purchase together. We didn’t have to use any of our contingency plans, but we know that we have each other’s backs.
2. Growing our savings
A silver lining of the COVID-19 pandemic—if there is such a thing—is that I saved a ton of money simply by not buying concert tickets and going out to eat. But you don’t need the world around you to shut down just to save money. Budgeting was an important first step to my saving strategy. After creating a budget, I realized that I was spending on things I didn’t need (hello, late-night Amazon purchases and weeknight pizza deliveries). I use a budgeting app to help keep my spending in check.
Once I reined in my spending, my savings started growing. I already had about $4,000 in my emergency fund, but I started saving more on top of that for the house. The most game-changing thing I did was to make saving automatic. I got my direct deposit split in two, so a portion went into my savings without any effort on my part.
I wasn’t even that aggressive about saving, but I was consistent. In six months, I had saved $8,000, bringing me to a total of $12,000 in savings. Griffen had saved about $9,000, too. Between budgeting and putting our savings on autopilot, together we saved enough for a down payment and that put our homeownership dreams within reach.
3. Boosting my credit score
When I moved to Atlanta, I had a job with a salary that didn’t exactly cover my basic needs. So, I garnered a lot of credit card debt just to live comfortably. But poor credit when you’re trying to buy a house won’t fly, so I knew I had to raise my credit score.
With federal student loan repayments on pause due to the pandemic, I was able to focus on paying off my high-interest credit card debt. I used some of my savings, knowing that with a higher credit score, I would be able to put less money down on the house.
I was able to put a huge dent in my credit card debt while deprioritizing the low- and no-interest debt. I’ll pay it all off eventually, but prioritizing my consumer debt was an important strategy for getting a quick boost to my credit score and a lower interest rate on the house.
4. Choosing a low down payment and smaller loan
This isn’t another tip about saving—it’s about not buying more house than you can afford (even if you’re approved for a larger loan).
Griffen and I knew we didn’t want to empty our savings when we bought the house. We put 3% down with a Federal Housing Administration (FHA) loan, which helps first-time homebuyers get homes by requiring lower minimum down payments and a lower credit score than many conventional loans.
We also bought about $100,000 below what we were approved for, because we didn’t need a bigger, pricier house just to have one. With the FHA loan and a conservative home price, we didn’t have a huge down payment. We also have money left over for some fun stuff to make the house our home—like paint and furniture!
5. Finding a trusted realtor
After getting mortgage preapproval, the next step was to find a realtor. We went with one that a friend recommended, and I highly recommend finding a realtor that has worked with somebody you know. You want someone who’s reliable, who knows the area well, and who can give you insightful tips throughout the process.
When you find that trusted realtor, listen to them. Our realtor recommended a local lender, but we decided to go with an online lender because of our tight timeline. While the online lender provided speed, we also lost the personalized customer service aspect of the process. It was like pulling teeth to get information from our loan officers—they were in different time zones, or they worked weird hours, or we had long hold times to talk with them. If we had to do it all over again, we’d probably go with a local lender instead.
6. Figuring out our must-haves …
Together, Griffen and I have three dogs. We also hope to foster dogs in the future. So, we knew we needed a house with a fenced-in backyard. And because we live far away from our families, we needed at least three bedrooms, so they’d have a place to stay when they visit. Finally, we’d lived together with one bathroom for long enough—we needed two bathrooms.
Three beds, two baths, backyard with a fence. It might not be the case for everyone, but those were the basics we decided we needed. Anything else was just icing on the cake.
7. … and being flexible with the rest
Flexibility is really what allowed us to be successful in our journey to homeownership. We were open to all options, like the neighborhood or whether it was move-in ready. This opened a lot of possibilities for things that people may not necessarily pick if they’re looking for “perfect.”
Our new house is in an up-and-coming neighborhood, but it had been listed for three months due to small issues (which felt like a lifetime for the state of the market). Because the owners had already moved to their new house, they were happy to work with us and get it off their hands.
8. Doing our research and asking for more
When buying a home, you have to ask questions. We gathered research and insights from friends who had recently bought homes and asked them how they sealed their deals. We also talked to our realtor. Collectively, our research helped us build a strong argument for our seller to concede some costs—and it worked! Our seller contributed quite a bit of money toward our closing costs, helping us pay less upfront.
9. Staying forward-focused
Homebuying is a stressful process, and it’s important to treat it like one. Take breaks as you need them and prioritize your health.
For Griffen and me, the process was exhausting, but the excitement of what was to come sustained us. And even though our to-do list grows every day, we’re really excited for what we can do: how we can bring more people, more dogs, and more experiences into our home. That hope ultimately makes the whole process worth it.