Are you a first-time home buyer or you are considering buying a home? If so, you may be feeling a little overwhelmed. There is so much to think about when buying a home! In this blog post, we will discuss some tips and useful information that will help you succeed in your home buying journey. Keep reading to learn more!
Why buy instead of renting?
If you’re still on the fence about buying a home, let us compare renting vs. buying. When you rent a property the money that is spent every month goes away and is not an investment for your future. When you buy a home your hard-earned money is spent on investment and your home will build equity for your future. You may even be able to deduct the cost of your mortgage loan interest and property tax from your federal and/or state income taxes.
How do you know if you’re even ready to buy a home?
Here are some key questions that will help you gage whether or not you are ready to buy a home:
Do I have a steady source of income? Have I been employed on a regular basis for the last 2-3 years?
Do I have a good record of paying my bills? Do I have a few outstanding long-term debts?
Do I have money saved for a down payment? Do I have the ability to pay a mortgage every month, plus additional costs?
If you answered “yes” to these questions, then you may be ready to buy your own home.
How much money will you need to buy a home?
There are three key expenses when buying a home: the earnest money (variable), the down payment, and the closing costs. These expenses vary depending on the cost of the home and other factors. Make sure to find out these costs for proper preparations.
Other expenses to consider other than the mortgage:
In owning your home you have to consider utilities, property taxes, homeowners insurance, and maintenance costs. Additionally, there may be homeowner association or condo association dues. Definitely, do some due diligence on these expenses for proper preparation.
How are pre-qualifying and pre-approval different?
A pre-qualification is an informal way to see how much you may be able to borrow. A pre-approval is the lender’s commitment to lend to you.
Should I use a real estate agent? How do I find a good one?
A good real estate professional can guide you through the entire process and make the experience much easier. Start by asking your family and friends if they can recommend an agent. Look for an agent who listens well and understands your needs. The ideal agent knows the local area well and has resources and contacts to help you in your search.
What is title insurance and why do I need it?
An owner’s policy of title insurance protects against loss of the title threats undiscovered at the time of closing and provides a defense in the event of claims against the title pursuant to the terms of the policy.
Now that you know some tips and useful information to help make your first-time home buying experience successful put them into action and happy house hunting!