A new year has begun and many people will be thinking about purchasing a house this year. That will be a resolution that people set for themselves this year for several reasons: 1) they are tired of renting; 2) family has expanded; or 3) they cannot pass up the opportunity to get into a home for little or nothing down. Do you fall into one of these categories? Before you begin the journey to the American Dream, understand if you are not prepared, it will turn into the American Nightmare.

For example you could be tired of renting because you think you are throwing your money away and not investing in yourself. This could be true, but have you prepared to become a homeowner? Do you have a budget of your current expenses? Do you have a budget of future expenses? If you answered no to these questions, can you see how this could end up being a choice with devastating consequences? Therefore, you should continue to rent until you can say you have considered all of the financial obligations that come with home ownership.

If you are renting and your family has expanded due to pregnancy or even marriage, some times you end up purchasing a home before you are ready. In this situation, you might end up choosing a starter home that will meet your needs versus that dream home that you cannot afford at this time. Or should you move up to a bigger size apart for six months to a year and then purchase a home? Understand there are always options out there and you should not be driven by emotions of a circumstance. Weigh all of your options.

If you are not tired of renting, family has not expanded but you continue to see those commercials that say no money down and you are a shopper?. STOP what you are doing and do not pick up that phone. Impulse shopping has led to major destruction, distress and even divorce. These ads that say no money down or bad debt no problem for example are nothing but trouble. What is happening is most people in financial trouble are the ones that are applying for the loans. The problem with this is they do not know how to manage money. Therein lies a dangerous problem with long-term consequences.

As a person that thinks about and wants the American Dream, understand there are long-term consequences for not being educated about the entire process. Home ownership is not just about buying the home, but also being able to own the home comfortably for a life-time. There is no benefit to being house-poor when you waited years to own your first home. Do your research it could save you thousands of dollars and peace of mind in the end.