It’s the moment in your life you have been waiting for. Are you ready to take the next step? Buying your first home can be daunting at first but with this simple tips, you will find that purchasing your first home is not that scary at all. Here are some tips you should know before you take the plunge.
- Save your money first
This tip seems pretty basic but it is very important. A normal home purchase will require at least 20% down payment. There are some instances where the down payment is less but it typically requires you to pay for mortgage insurance. The trick is to actually understand what your money can buy. As a general rule of thumb, you should spend a maximum of 30 to 38% of your monthly pre-tax income on housing costs. Please be aware that banks would need to see a saving that can reflect a few months’ worth of mortgage payments so it’s wise to start saving now.
- Hunt for your mortgage
Purchasing a house requires a large sum of money. The good news is you can opt for a loan. And even a better news: there a lot of options. The most popular mortgage are those with fixed interest rate spanning for 15 or 30 years. The 15 years of payments are for those who are looking to pay the loan quickly with less interest rate while the 30 years of payments are for those who are seeking a more affordable option. It is wise to hire a professional mortgage provider and see what you are qualified for. Once you have a pre-approval, you have more credibility on the house you are bidding for.
- Locate your dream home
The most exciting part is here: time to visit your future houses! Look at the location and pay special attention to the layout and structure of the house. When you put an offer, it is wise to hire a good home inspector. They will help you find the possible flaws of the houses and this in return, can save you money and help you negotiate lower prices. They can even help save you from a bad buy.
We wish the best of luck in your first home purchase !