If you are interested in buying a home its important that you prepare in advance before you start buying. You don’t want to be bounced into purchasing something that is outside your budget.
It is also important to ensure that the house you purchase is a solid investment and does not have any serious issues which could cost you thousands of dollars to fix.
Here is what should be on your home buying checklist and how to ensure purchasing a house goes smoothly.
1. Know What You Can Afford
If you purchase a house that you later realize you cannot afford, you could find yourself having to sell your home at a loss. You could even have to declare yourself bankrupt because you’ve quickly had to borrow more money to keep yourself afloat and your financial situation has spiraled out of control.
Having a thorough understanding of what you can afford cannot be overstated. Do your sums carefully but also ensure that you have factored in a buffer. There are houses that you could push yourself to afford but taking out a mortgage means you will have no room to breathe, no ability to save for the future or to adjust if circumstances change.
Ensure you know what your monthly budget is and what your mortgage repayments will look like. Don’t rely on future earnings e.g perhaps you have been promised a promotion in six months.
Do not assume that this will be the case and buy a house assuming this money would come through.
Be sure to have savings as well so that you can cover the cost of the mortgage if you were ever to lose your job or your partner left you.
Being well within budget should be top of your house shopping checklist.
2. Clear Your Debts
A mortgage is a big debt and you would be wise to try and pay it off as soon as you can. It makes sense therefore to clear any other debts you have first so that you have a clean slate and to avoid taking out new debts over the holiday season. This can also make it easier to get a mortgage in the first place.
Debts you could take care of include:
- Credit card bills
- Cars on finance
- Outstanding phone contracts
- Payday loans
- The money you owe individuals
A clean slate can also help you feel better in yourself about taking on such a large debt. Too much debt is not good for our mental health and can make us worry, thought the evidence this attitude is changing in the younger generation. Buying a house should be like starting a clean slate.
Be sure to do this before you start looking for a house. Eyeing up houses before you have settled your debts can make you reluctant to pay them off and to instead spend all of your current funds on a new house.
3. Take A Trusted Friend or Family Member With You
If you are ready to start exploring the housing market then be sure to find a trusted and experienced friend who can come with you on this journey. This is a key aspect of your first time home buyer checklist.
Real estate agents are always keen for a sell and are unlikely to give you the full picture about a house. If you are first time buyer you can end up falling in love with many houses – getting caught up in the romance of buying your first house – that you can overlook crucial elements.
Don’t be rushed into signing real estate contracts too quickly.
A friend who has bought a house before will know what to look out for and will help ensure you don’t buy a house that is too expensive for what is on offer or that later turns out to have major faults.
Some of the issues that a trusted friend or family member can help you look out for include mold hidden under rugs and behind picture frames. This is a classic example of a problem that could potentially lead to you having to have the foundations of the house complete rebuild.
Other issues include leaking roofs and a kitchen that has not been installed correctly.
Be Nosy and Check-Out Next Door
There is also the aspect of the neighbors. Whilst you might be distracted by the house itself, you may fail to have a nosy at who you will be living with and how close their houses are to yours. Be sure to include good neighbors on your house shopping checklist.
What issues could arise with them and what kind of people they are are questions you want to try and get an answer for. Your trusted friend or family member can help.
A Home Buying Checklist is Important
Today’s market is a crowded one. We live in an age of competition and where real estate agents are keen to make as much money as they can.
It is important therefore that you don’t just trust their opinion but you have your wits about you. A home buying checklist is key. You need to ensure that when you come to purchase your house you are not bounced into buying something you cannot afford.
You can resolve this issue by ensuring you have all of your debs cleared in advance and having a detailed understanding of how far your budget will stretch and what would be over budget. Credit cards, car finance, and other loans should all be tied up before you begin your search.
Once you know what you can afford the next step is to ensure a trusted friend is available to come house hunting with you. This person should be experienced at buying houses or they should work in real estate.
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