How prepared are you when it comes to buying your next house? Whether it’s your first time getting a foot on the property ladder or you are a pro at moving, it pays dividends to do your research prior to moving. And with the housing market bubble showing no signs of bursting soon, you need to be as competitive as possible or sell your current home if required and get the property you want at the best possible price.
Read on for some days you can prepare to make your property purchase smoother and easier.
1. Know Your Why
This is important to know before you make any big purchases. Why exactly do you want to do this? Are you looking for a home to get on the property ladder and have as a starter home? Do you need to move to a bigger home for a growing family, or is it finally time to find your forever home? Whatever the reason, you need to know why you are doing this to help you make the right decision. The last thing you want is to buy a house simply because you think you are supposed to and make a bad financial mistake.
2. Check Your Credit Score
Mortgages are becoming increasingly difficult to secure, thanks to the state of the economy. While not impossible, you need to meet stricter criteria. Ideally, you need to be above 620 for the best rates and a higher level of acceptance. While you can still obtain a mortgage below 620, you might be subject to stricter terms and higher interest rates. As such, it can be worth knowing and polishing up your credit score before considering getting a mortgage or refinancing to facilitate a new purchase.
3. Hire A Real Estate Agent
It can be worth getting a real estate agent ahead of time, basically, if you have pre-approval, as this can give you a better insight into what the local property market is and what you can expect in terms of putting offers in, meeting terms, and so on. Talk to a few companies in your area, such as https://www.hershenberggroup.com/ to help you find the right realtor for you and to help you get the lowdown on what to expect once your hunt begins.
4. Save for A Downpayment
The average downpayment for a home is 6% minimum. While you can get a mortgage with a lower amount, e.g., 3%, it can all depend on your circumstances and your credit score. The bigger the downpayment, the better, and many people will try to aim for 10%, although this can vary depending on the mortgage value offered.
5. Save For Fees
There are many fees that come with buying a house, and typically, they’re not all included in the mortgage or can come from your down payment. Research what you can likely expect to pay for on top of your downpayment to get a good idea of what you need to save for. These closing costs can include; lenders’ fees, home insurance, home inspection, appraisal, sellers’ fees, realtors’, real estate attorney fees, and more. This needs to be factored into your expenses as they will need to be paid upfront in most cases.
6. View Multiple Homes
This is so important. The last thing you want to do is get carried away and sign on the dotted line for the first home you see. You need to think with your head and heart and go to multiple viewings to get a good idea of what is available and what you can expect within your budget. Try to push any preconceived notions of what you want to one side and look at what type of homes you can purchase and get a feel for what you do want and what you don’t want based on what others have done with their homes.
7. Can You Afford It?
Lastly, just because you can afford your home on paper doesn’t mean things will work out this way. Run through your finances in real-time, not just on paper, to better understand what you can afford. Look at your current expenses and then add in everything you will need to pay for once you buy a house. This includes instances, the cost of purchasing appliances, home repairs or renovations, bills, taxes, etc. It isn’t as simple as paying your mortgage, and being a homeowner is a big responsibility. This applies even if you already own your home and are considering upsizing to a bigger place. Can you really afford the additional expense this can bring, and what can you realistically expect to be paying out?
Conclusion
Buying a home can be exciting, but it can also be expensive and come with many hidden fees and costs. Knowing you want to do this, how you will be able to afford it, and what is available to you can help you make better decisions and avoid common mistakes in buying a new home.
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