Some Important Tips for First Time Home Buyers


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Home buying is a big life event that involves a lot of planning and of course money. Buying a home is one of the biggest purchases that you make in your life so it is wise to know all the details related to the process from start to finish. If you too are planning to buy a home soon, here are a few key points to consider:

Make Sure You Are Ready

Buying a home is much more than renting an apartment as it involves a lot of money. Consider all the factors related to homeownership before you decide to buy a home. Home repairs, property taxes, utility connections and maintenance, and garbage pickup are some basic costs that you will have to bear once you own a home. Make sure you are prepared to pay for all these things along with the monthly mortgage. Also, be prepared for the expenses that you will have to bear after the purchase like moving costs. Getting moving quotes from trusted moving companies is another task related to homebuying.

It is a good idea to save some funds before buying your new home, and also, ensure that you have cleared all your debts. Don’t buy a home merely due to social or family pressure as this may lead to a severe financial crisis. 

Know Your Finances

Consider all the costs related to your purchase as your mortgage type will decide the requirements of the down payment. It is important to choose a house that fits in your budget and does not go overboard. If you are planning to take a mortgage, it is important to strengthen your credit score before opting for one. 

Research about the mortgage options well; conventional mortgage, Federal Housing Administration (FHA) loans, Department of Veteran Affairs (VA) loans, and U.S. Department of Agriculture (USDA) loans are main mortgage categories that you can explore. Most people opt for a fixed-rate mortgage with lower monthly payments over lower interest rates with higher monthly income. You have to decide what suits you the best.

Compare Varied Mortgage Rates

It is wise to compare the mortgage rates and interest offered by multiple lenders based on costs, interest rates, and origination fees. Some lenders offer to buy discount points to lower the interest rate and make sure you keep all these points in mind while comparing their mortgage rates and interests.

Choose Right Real Estate Company

Make sure you hire a good real estate agent as he can help you in finding a property within your budget and meet your needs as well.  He will also help you through negotiation and final pricing. You can ask your family and friends for referrals while looking for a real estate agent.

Choose Right Neighborhood 

It is important to know the in and out of the area that you are exploring; know the type of homes available and also if it suits your budget. A good neighbourhood is a must when deciding on a property for your home. Lifestyle, availability of amenities, and budget are major concerns when looking for a house. Townhomes, condos, and fixer-uppers are some of the common types of houses that first-time buyers prefer. Also, decide if you are buying a house as a starter home or you want to keep this as a forever home.  

Stick to Your Budget

It is often seen that people go beyond their budget when are offered more loans which is not right. Many mortgage companies will offer you extra loans, make sure you don’t fall for such luring offers and avoid unnecessary financial stress. Plan your budget well and stick to it no matter what. 

Negotiate 

Do not just agree on the first price quoted by the seller, talk to the seller to lower the rate. Most sellers do quote a higher price in the beginning and keep a margin to take down the price to some extent. Alternatively, you can ask the seller to repair all the damaged areas as that will save you a lot of money. Though the local market decides the scope of negotiation, there is no harm in trying. If your local market has more buyers than sellers, there is less scope for negotiation. 

Home Insurance

Though homeowners insurance is required before closing your mortgage deal, it also provides liability insurance. Homeowners insurance covers all the costs related to repairing the damages done due to incidents covered in the policy and sometimes even due to natural causes. It also covers liability insurance that you get if you meet an injury and accident. So, it is wise to buy enough insurance to cover the overall cost of the property so that you can rebuild your home in case of total damage. 

Now that you know the key points to consider during a house purchase, you can move forward and buy your dream home. 

 

 

 

Ref number: THSI-2472

 


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