Welcome to the summer month of June - not only is it Gay Pride, but also a key financial awareness month for Homeownership. Purchasing a home is often a stressful situation for any individual, especially those without previous experience. To help with you newbies out there, here are a couple of great tips for buying your first home stress-free!
1. Save, Save, Save!
Save early and often. Understand that for most people, a house is often their most expensive asset. Not only do down payments force new owners to put skin in the game, loan rates and repayments can get expensive. Be prepared and get ahead of these financial challenges - it is much easier to sleep knowing that your home is secure.
2. Understand your Price Range
This tip cannot be understated. Many times, new homeowners underestimate costs of owning a house. Property taxes, insurance, utility, and maintenance costs add up! Careful with online mortgage calculators: they may not faithfully reveal the full expense. Be sure to consult with an expert, and leave no uncertainty before proceeding.
3. Get Pre-Approved on a Home Loan
Wish to truly leave nothing up to chance? Get pre-approved on a home loan. This process means that a mortgage lender has reviewed all of your financial paperwork and is ready to give you a loan. Besides assuring yourself that you are ready to own a home, pre-approval offers other sneaky benefits. In fact, here's a super neat trick: getting pre-approved on a home loan makes for an attractive buyer for sellers. In competitive markets, pre-approval can give you an edge over those who have not begun to process.
4. Budget Home Maintenance
Rule of thumb: Set aside 1 - 4% of your home's value annually for maintenance costs. Newer homes may cost less while older models could require more cash to maintain. Whatever your case, be adequately prepared with a managed fund to protect yourself against unforeseen costs.
Purchasing a home is difficult, complex, and stressful. However, these tips should help you first-time buyers avoid some colossal issues. While there is indeed much more to the process than what has been detailed, you are well on-track if you understand these concepts and are confident in yourself to follow through.