Are you interested in buying a house? If yes, then you’re are at the best place for insights into the whole process. Buying a house, once considered can become a very emotional activity. You might find yourself stalking listed homes on your home-browsing app or allowing your schedule to accommodate drive-by viewings.
It is very easy to purchase a house you cannot afford and that mistake can seriously impair your ability to accumulate wealth down the line. Understanding the right way to buy a home helps you avoid grievous financial mistakes.
When to purchase
Before anything else, you have to consider timing. Evaluate your finances and make sure you have a steady income and enough cash saved for the down payment. You also have to consider the housing market because you want a home that will go up in value. Discuss the market with your real estate agent. Consider your life stage. The process of buying a house is expensive and you should not invest that much into an activity when you may move the next year.
Don’t restrict your financial growth by making decisions with a short-sighted perspective. A weak financial foundation is key to regretting your home purchase. You have to be financially ready to buy a house and this means paying off debts and saving up three to six months of expenses. When you become the home owner, you will be in charge of paying for repairs. Saving for the down payment is one of the most difficult aspects. You may consider saving up as much as 20 percent of the home value for a down payment to avoid Private Mortgage Insurance (PMI). Moving expenses should also be taken into consideration as part of your total savings for a home purchase.
The optimal way to get a house is with cash. It may sound far out but people do it. If it is not feasible for you, you’ll require a home mortgage loan. To get prequalified to buy a house, a lender will find out about your income, assets and down payment. Getting preapproved is more of a challenge. The lender will confirm your financial information and submit your application for preliminary underwriting. When you begin your home search, a preapproval letter shows you are a serious buyer. Mortgage options varies so decide on the best one for your financial status.
Find the right agent
You can do a lot on your own but getting assistance from an expert will go a long way in finding and securing the perfect place. A buyer’s agent can even help you find a house before it is listed for sale. The agent will also do the job of negotiating offers for you. In most cases, the seller even pays your agent’s fees.
Before starting your search, make a list of features of a home that are vital to you and don’t compromise on them to avoid regret. Once you have clarity on what you want, share it with your agent. Your agent will help set realistic expectations and streamline your search to areas you can afford. One thing to keep in mind is that a great house in a bad neighborhood may not be a good idea. Your home may be your biggest investment so select a home that should grow in value.
Article by Vital Guidance