You probably don’t mind renting for now. After all, it has its benefits. For one thing, you’re not tied to a property. Any time you need to move to explore whatever life-changing opportunities, you’re free to do so. But there will come a time when you need to settle down. And settling down means you’ll require a home that you can call your own. That’s most true if you’re ready to start a family.
If you are close to that phase of your life, you’re likely considering purchasing a house in earnest. The first order of business is to acquaint yourself with the common mistakes first-time homebuyers should avoid. Knowing those pitfalls will steer you in the right direction. Next, you need to know how best to approach the process. Here are some recommendations.
Get your finances in order
Ideally, you began saving early. And by the time you’re ready to sign a contract, you have enough for a down payment. Keep in mind that the more you shell out upfront, the smaller your monthly mortgage will be. Plus, the shorter the mortgage duration.
On top of down payment, you will also spend for closing costs that typically amount to at least 2 percent of your mortgage plan. And there are moving-in expenses to factor into the equation as well. Think repairs, furnishings, and upgrades.
You need a good credit rating. So make sure that your debts have been taken care of. You will have a difficult time getting approved for loans if lenders see that your finances are in disarray.
Shop for the best mortgage option
One thing to keep in mind is the importance of committing to what you can afford. You must have a budget in mind and you need to stick to it. Do not get ahead of yourself and sign a contract that’s impractical money-wise. That’s true even if you’re applying for a loan that’s payable over 10 years or longer.
Explore all mortgage options available. Conventional mortgages can offer first-time homebuyers deals for as low as three percent down payment. You can also check out government-insured loans. Or maximize government-sponsored first-time homeowner’s assistance.
Compare mortgage rates and fees. Do not say yes to the first tempting offer presented to you. Have as many options and decide which one’s the most practical based on your financial status.
Work with a reliable agent
Sure, you can use Zillow and other real estate online platforms to check out properties. But that’s the most you could do with those platforms. You still need a real estate agent to partner with. They know the ins and outs of the industry, and they will be able to lead you in the right direction. Plus, if you’re busy with your job, an agent can manage the procurement of pertinent purchase documents on your behalf.
Ask your real estate agent for as many options as possible. Make sure to zero in only on properties that have already passed government compliance measures. For example, look for the EICR inspection certificate. The property that you will buy should not have faulty wiring, which could cause an accident.
Don’t miss open houses. That’s the only way you can get a feel of a home. Plus, you get to visit the neighborhood where it’s located, which is crucial. Ideally, you purchase a house in an area that has great economic prospects. Plus, a haven for the family you plan to raise if that’s in the offing.
Negotiate with the seller
There’s no need to agree to the price tag first offered to you. It’s always smart to haggle. With the help of your agent, negotiate with the seller. Once you agree on a price, do another inspection of the property before signing the contract. You want to be extra sure that you did not miss any red flags. The foundation’s perfect. There’s no bug infestation. The likes.
Lastly, have the property insured. Once the deed of sale is finalized, the house is your responsibility. You want to be protected from untoward eventualities.
Whether you’re buying a starter house or a home you plan to spend the rest of your life in, you must be quite discerning when choosing a property. It’s a huge investment, after all. And it will affect your future financial plans. Here there’s nothing wrong with taking your time.
As they say, only fools rush in. And the last thing you want to be when investing in real estate is foolhardy. Be a smart and informed buyer. The recommendations listed above should help you out with the process. By all means, explore other tactics that might work in your favor.