Becoming a homeowner is a huge decision to make as well as being a huge investment opportunity. Not only is there a lot to commit to, but it gives you the opportunity to enjoy a place that you can call your own. But like everything else that presents itself in life you need to be prepared for it. And the best way to prepare is to follow the tips that we’ve listed for you below.
Decide if now is the Best Time
Making a decision to buy a home is equally as important as deciding when the best time will be to make a purchase. Just like all decisions, you need to be ready for anything and everything that involves the home. Things like repairs, utilities, garbage, and water can quickly add up on top of your monthly mortgage payment. On top of these, you’ll also need to pay the property taxes and enhanced home insurance.
The best way to prepare that can save you money is to become completely debt free and saving money in a savings account. Having money saved separately will eliminate the need to spend money that may be used for other expenditures. So before feeling persuaded into buying a home, make sure that now is the best time.
Look for the best Loan
Obtaining a loan is a necessity for most people who wish to buy a home. A lot of times it is also a good idea to obtain pre-approval so that you can make a price range of homes that you are interested in viewing. A pre-approval will also tell you the amount that can be afforded by you.
In order to save money, it is best to work with a broker who can help you by presenting you with many different loan options that have great rates for your budget.
You can also go through your own bank which may save you money because of having accounts already established with them. With your bank already knowing how you’re responsible with your current accounts could work in your favour when it comes to determining a rate.
Choose the Type of Loan with Great Repayment Options
As far as mortgages are concerned, there are many different types of mortgages available as well as different options for repayment. By conducting research you’ll be able to secure the best loan that you can afford.
With both 15 and 20-year loans being pretty popular, they allow you to repay in a shorter amount of time and likely will include a lower interest rate based on your credit. However, many prospective homebuyers prefer loans that extend to at least 30 years. This is due to the payment being lower each month regardless of their interest rate possibly being higher.
Mortgages with Adjustable or Fixed Rates
If you have a mortgage rate that is adjustable means that the interest rate will change each month. Starting out, your rate will be low but as time goes on it will fluctuate as the housing market fluctuates. So your monthly payment will also fluctuate.
When you have a mortgage rate that is fixed it will never fluctuate from what you agreed to pay. Having a rate that is fixed allows you to enjoy making stable monthly payments that can be planned around. The downfall of a fixed-rate is not being able to enjoy possible lower rates as the market fluctuates. However, by keeping an eye on the market, you could benefit by refinancing to the lower rates as they occur resulting in more money in your pocket each month.
Be Prepared to Make a Down Payment
When you make a sizeable down payment will take a huge chunk out of the total repayment amount. Your down payment can make instant savings as long as you pay at least 20%.
Get in Contact with Real Estate Company
After you receive your pre-approval and decided on how much you’re willing to pay in monthly payments, you need to find the real estate agent responsible for the home that interests you. While working with an agent they need to give all of your requirements and needs their full attention. Allow your agent to make suggestions and go over the home buying process so that your home will truly feel like you want.
After making an offer on a home, the agent will begin the process of negotiating with you so that the terms can be determined and all parties are in agreement with.
Obtain a Pre-inspection of the Home
After you and your real estate agent have agreed on a home to be purchased, you need to get it inspected for damage or anything that may be questionable. Depending on the terms of the purchase you may choose to either pay for the inspection or have it included.
As the home is inspected you need to make sure that you are right there with the inspector so that you can make note of their findings. This will allow you to determine the need for repairs that are urgent or repairs that can wait. A few examples include a bad roof, crumbling foundation, termites, or even harmful mold. When you know about these issues now, they will save you quite a bit of money in the future as they are fixed.
Furthermore, having knowledge of current issues may provide more leverage in obtaining a lower purchase price. However, if the current owner refuses to budge from the asking price, then there is nothing that says you can’t walk away from the home. This will save you from making a big investment mistake.
Closing on the Home
When you have finished closing on the home and all funds have appropriated properly you can begin the moving process from your old location to your new home.
When you move you’ll need to update your address with all of your accounts including utilities. When it comes to utilities your best option to save money will be to simply transfer service from your old location to your new home. Transferring service will allow you to pocket the fees often seen with new installation.