Buying a House at 24 Years Old!

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House buying for many millennials can seem like a “maybe someday” task. At 22, I set a goal to be in my home buy 25. And I bought a house at 24! It seems so crazy that just like that, I am a homeowner.  I have received a ton of questions about my mortgage in relation to my finance goals so I thought I would just break down all of the house questions I have been getting in one single post!

I got pre-approved for my mortgage in October of 2018. Veteran’s United had a ton of resources available to make me feel confident in my choices. I originally got pre-approved for $150,000. It was long before I was really ready, but it gave me time to look. I still had a few months left on paying off my debt, but I wanted to get a feel for the areas of my town.I had made a checklist of all of the things that I wanted in a house. After living in more than 7 rental places, I had a good idea of things I did and didn’t want in a house.

In February 2019, I paid off my last student loan. So after that, I really started looking online at houses. I met with the realtor that Veteran’s United had assigned me and started going to look in person. In person, I looked at 3 houses total.

I was so ready to be a homeowner!

Originally when I looked at the house online, I didn’t even want to go look at the house. I just wasn’t interested. It wasn’t really the neighborhood I wanted. It only had one bathroom. The house was a little over my first budget. It needed a lot more cosmetic love than I wanted to put into it (based on the pictures.)

My realtor said it would be good to look at a few in person to get a feel for what I wanted. I looked at the house and I feel in love. My check list included a 2 stall garage, 3 bedroom, a yard that could be fenced in, and two bathrooms. The only thing this house didn’t meet was the two bathrooms. It did need a lot of cosmetic love. Things like painting, flooring, and updating were things that hadn’t been done in quite some time. Ultimately, if the house would have been updated, it would have been worth about $20,000 more than what I paid for it.

I went back to the realtor’s office and put an offer in on the house! Within hours, they accepted my offer and we started talking about the next steps! It really happened so fast. I was actually behind the bar at work when I got the text saying they accepted my offer on the house.

From there, it was mostly e-mails and texts back and forth with paperwork they needed from me before we could move forward. Then, the inspection and appraisal. The Veteran’s United did a really good job of making sure that everything was taken care of. All of my questions were answered quickly and they never made me feel like I was bugging them. I closed on the house at the end of May!

 

About my house

My house is a 3 bedroom, 1 bathroom, 2 stall garage house. I have a decent sized backyard. It is on the very outside of the city that I live in and less than 5 minutes from the interstate. From my home, I can get back to my parent’s house/my hometown a lot faster than many other places that I have lived in since I moved away. This means that I am also a lot closer to my second bar job. I am a little bit further away from my main job, but somewhere in the middle of both jobs.

By the time that we got to the house to close, my sign had fallen apart. I felt totally cheated on my stereotypical picture of me with my sold sign, but I guess its fine! For a lot of people that are asking, I bought my house for $165,000. To a lot of areas of the country, that is really cheap, but in comparison to my area, it is somewhere in the middle. There were a lot of houses that were a lot cheaper that didn’t have everything I wanted. There were quite a few houses that were a lot more expensive.

I have moved around for the last 6 years of being out of my parent’s house. Due to the different situations, I have lived in 9 places and had over 14 different roommates (not including my army living situations.)  I was ready to be done with the temporary living. In the midst of transitions, I had bought and sold so much furniture and belongings. Being in my house has created a peace and level of contentment that I have never had while renting.

Yes, my mortgage is really cheap in comparison to some parts of the country.

I don’t know how many times I have received this question. My monthly mortgage payment is $1,100. My escrow is built in, so my monthly mortgage payment is only around $800 without the taxes and insurance. Once I get to baby step 6, I know it will start flying buy faster.

I would say that it is partially due to my extremely low cost of living. Nebraska is really cheap for housing and I would say that my house is in the middle range for houses in my area. I would also tell you that I house hunted for MONTHS. I started looking on Zillow and other real estate websites in December and I didn’t put a single offer in until April. Because I took my time, I looked at a ton of different houses. I figured out what was worth paying a little more for and what I didn’t want. One of the things that actually made my house more expensive is that I gave myself plenty of room to grow.

No. I am not married.

I haven’t really received this question online, but I have gotten it a lot at work. When I tell someone I bought a house, I have been asked a few times if I was married. I have also been asked what my spouse does that I can afford a house. Yes. Someone literally said to me, “Oh, you bought a house. What does your spouse do?”  Nope.

Here is the thing, I am “just” a bartender, but I paid off all of my debt. I created a budget. And I stick to my budget pretty consistently. I have changed my spending habits. That is how I can afford a house.

That being said, my boyfriend does live in my house. Our phrase has been, “my house, but our home.” I want him to feel comfortable here and he does help with some of the costs, but he isn’t on any of the paperwork, which is fine with us.

I went through Veteran’s United and used my VA loan.

I spent 6 years in the Nebraska National Guard which means I was eligible for a Veteran’s Affairs Home Loan. They are known for their low interest rates. The VA loan also means that they did an appraisal that is a little more strict than most. Mostly, their job is to look out for service members to make sure they don’t get caught up in a bad house.

I can not say enough good things about Veteran’s United and the team that I had for my home loan. They were amazingly helpful and made me feel like I was informed as I was filling things out and signing everything. My home loan was significantly less than what I was approved for and they never made me feel pressured to spend more. If you are eligible for a VA loan, I strongly recommend Veteran’s United.

I didn’t put down a down payment on my house.

Lots of people asked about this. I paid off my last debt on February 11th, 2019 and closed on the house on May 28th. The quick turn around had a lot of people questioning what happened. The VA Loan is also known for their 0% down with no fees. There is no Private Mortgage Insurance (PMI) on my mortgage, which is why a lot of people are dead set on 20% down.

I know that it wasn’t a Dave Ramsey approved move and I know that most people wouldn’t suggest it. I still stand by my decision and I am okay with doing it this way. This move was a conscious decision because I wanted to be in my own house. The housing market is moving extremely fast here. I took advantage of the opportunity given to me with my VA Loan.

It is a 30 Year Loan

There are going to be people that freak out over this. I am well aware of the fact that 15 year loans are a far better way to go compared to 30 year loans. The charts are out there. I know what Dave Ramsey says. I still did a 30 year loan with my VA loan. They didn’t really give me an opportunity to choose and I know I probably could have if I would have said something. To me, it really isn’t a big deal. I am currently on baby step three of building my emergency fund.

Once I have my emergency fund, I will start investing and be onto baby step 6 of paying down the house. My goal is to have this house paid off in 10 years. Right now, that seems extremely overwhelming, but exciting at the same time. Regardless of how many years the loan says that I have, I know that isn’t the case.

Personal finance is personal.

That is such an over used phrase, but it really is true. Ultimately, I know that I didn’t follow any of the financial advice that Dave Ramsey recommends.  I also know that I have spent the last two years getting out of debt and building good money habits. I know that I will stick to what I know, I will be on baby step six (pay down the house early) before I know it and I will be throwing extra money to my mortgage.

If you are still in debt and haven’t created a budget that works for you, I wouldn’t suggest making the mortgage decisions that I made. Because I know my money habits, I am confident of my ability to work my mortgage into my budget well and still pay extra when that time comes.