There are plenty of things that can go wrong when you’re buying a home. Luckily, the process becomes easier the more homes you buy; this is simply due to the fact that you are more informed about the process the more times that you experience it. However, there is a way to become a well-worn home buyer before even purchasing your first home. The key to this is becoming educated. Throughout the course of this brief article, you will learn about 4 things to consider as a first-time homeowner.
Mortgage Payments, Etc.
The key to this heading is the “etc.” portion. Many first time home buyers believe that they can easily afford a home because they can afford the mortgage involved with purchasing a home. However, there is more that goes into purchasing a home than simply paying for the mortgage. The “real cost” of purchasing a home involves several things in addition to the mortgage. Property insurance, homeowner’s association dues, taxes, maintenance, and a slew of utility bills mean that the real cost of buying a home is much higher than what’s on the papers for the mortgage.
Most people assume that the first step that goes into home buying is looking for and subsequently finding the right home. However, this is not the case. The first step when it comes to finding the right home is becoming pre-qualified for a mortgage. The fact of the matter is, if you don’t pre-qualify for a mortgage, you definitely won’t qualify for a mortgage from any respectable bank. Therefore, any time and effort spent looking for the right home before becoming pre-qualified will have been in vain, as the simple fact of the matter is, you won’t even be able to purchase a home. Learn about pre-qualification before going house hunting!
Don’t attempt to purchase a home — especially if you’re a first time home buyer — without some professional help. There are several professionals that are in your corner when it comes to helping you find the right home. Professionals such as real estate agents, any credible realtor, brokers, and sometimes even lawyers can help ameliorate the process of buying a home for the first time. Real estate agents are particularly good to have in your corner, as they are people that are trained to deal with the logistics and contingencies of the housing market in the neighborhood where you’re looking for a home.
One of the biggest mistakes that first time home purchasers commit is spending all of their savings on down payment and closing cost. If you have the cash to spare, it is wise to meet the average of a 10% down payment on your mortgage and lessen the cost over time. If you don’t have enough for a larger down payment, you will end up taking up a larger mortgage. By using all of your savings to meet a down payment, you are forgetting to factor in the real cost of owning a house. Remember: there are other bills to pay and other loan quotes that must be met, so you should keep savings on hand in case of an emergency.