Owning a home is one of the lifetime investments every person should consider. If you are contemplating about buying a home, then you are just about to invest in one of the most valuable assets. With the ever rising cost of paying for rent, owning your own home can come as a reprieve. However, being a costly investment, there are basic things one should know before they make up their mind.
You should not let the current market conditions dictate your decision. You have probably heard that the current housing conditions are favorable- affordability, very low interest rates and many others. But this does not necessarily mean that you should also get stuck with a house you are ideally not ready for. If you feel you do not have a good credit score, then waiting for a few years won’t do you any harm.
Home ownership comes with a lot of expenses. Besides monthly mortgage repayments, you must brace yourself for many other expenses; insurance, utilities and property taxes, just to mention a few. So, don’t go for something that will push you to the wall. You may consider scaling down your choice to a smaller and manageable home rather than buying the biggest one.
You should consider signing for a sizeable down payment. Besides giving you instant equity, it also gives you a manageable monthly payment method. However, if you are working on a limited budget, then there are several state agencies that can help you with down payments and other logistics. A real estate website can also offer valuable advice on the same.
Though many people prefer foreclosures and short sales due to their benefits, they also come with a number of risks and pitfalls. Foreclosures are sold in their current state, meaning that the owner will meet all renovation and any other related costs. This may turn out to be expensive than earlier thought.
It is highly recommended to have a pre-approval letter beforehand. This letter determines the maximum purchase price besides showing sellers that you are serious about buying the home. You can also use it to determine favorable interest rates.
Buying a home close to social amenities like schools comes highly recommended. A home’s value is determined by its location. This comes in handy later in life when you need to sell it. So, keenly look into location before buying.
Not all real estate agents represent the best interest of their clients. If you are a first time home buyer, then you would feel safe working with a buyer agent. This is the perfect way to eliminate conflict of interest since they never take listings.
You should do a comprehensive market analysis to help you make a concrete and informed decision. Your estate agent should help you compare various options available to enable you choose a home that matches your taste and budget.
Home inspection is very vital. However much you like the house, don’t get into the temptation of accepting it without an inspection. That is where contingencies chip in. If for any reason your lender has refused to fund the loan, then it is not worth the deal.
Home buyers who qualify for credit can reduce their income tax withholding. This in return increases their monthly pay. Such individuals can use this money to acquire a home faster and stress-free.