For First-time Homebuyers: Secrets to a More Affordable Home Purchase
Buying a house for the first time is always an exciting experience. You are finally realizing your dream home purchase and are only a few steps away from becoming a homeowner. Since this likely your first time buying a property, it pays to do a bit of research and ask loved ones about recommendations. This will help you find the best ways to tackle homebuying and avoid the usual regrets of first-time homebuyers.
If there is anything first-time homebuyers want to achieve, that is to achieve an affordable home purchase. A house costs a lot of money. Since not many people are capable of paying in cash, they want to save as much money as possible during the purchase.
You may already found a great lender who is offering a sizable loan for first-time homebuyers like you. You managed to shop for mortgages and even got preapproved. But there are other things you can do to make your next investment a more affordable one.
Don’t Treat the Home Purchase as a Date
Sure, you are hunting houses after houses that are within your price range. You are looking for the best one that will fit your requirements and your lifestyle. Then, you managed to find one that you instantly fell in love with.
It could be due to the gorgeous kitchen, the nice pool at the back, or that wonderful view from the master’s bedroom. The house you fell in love with may be a little bit out of your price range, have more repairs than necessary, or may not have all the rooms you and your family need. If you let our emotions decide on what house to take, you can end up regretting the purchase in the long run.
As much as possible, look beyond the features you fell in love with. Listen to your gut feel and not just what your heart tells you. Before you make a decision, ask yourself many times and think about the things you need to sacrifice if you ever go for the house you love versus the one your instinct is telling you to invest in.
Use Research to Your Advantage
You may already have an idea of how much similar houses are worth within the neighborhood. The place looks peaceful and quiet, which makes it a great location for raising a family or working remotely. But then, looks can be deceiving.
What you want to is to check if the home purchase is worth your every penny. One way to figure out is to visit the neighborhood for a few days. Ask store owners and businesses around the block about the neighborhood.
Drive a few times and check how far amenities and public transport are from the house. Check the crime rate and check the place during different times of the day. It also won’t hurt to find out if the seller is paying their property tax on time or not.
Use a Home Inspection as a Bargaining Tool
Lenders usually don’t require their borrowers to get a home inspection. What they need is an appraisal. They want to make sure that the purchase price is not lower than the market value of the house you are selling. But then, investing in a home inspection is always a good idea.
For one, you get to identify what the necessary repairs and maintenance are on the property you plan on selling. The result of the inspection will give you an idea of how much of a fixer-upper home you are investing in. Once you get a hold of the report, you can use this to your advantage.
You can use the home inspection report to negotiate the price with the seller. You can either ask them to lower the price so you can handle the maintenance repairs or let them be responsible for the repair. This should give you an idea of whether the purchase price is worth it.
Never Stretch Your Budget Too Much
A good rule of thumb is to get a mortgage that will only accumulate less than 30% of your monthly income. This is since you need to take into consideration your other recurring expenses like debt payments, your savings, and other homeownership costs. As the experts say, go for a lesser house the first time to avoid being house poor.
You want to make sure you have enough budget to save up each month for home maintenance and repair. If you go beyond your budget and you can’t even afford to buy the necessary furniture upon moving, then this will only be the start of your financial struggles. Always choose the house you can comfortably afford then that big comfortable house you eventually fret at night.
Buying your first home may feel like a dream come true. There are so many considerations to make which can make the experience overwhelming. But by making the decision to buy a more affordable house you can comfortably pay for, you will have better peace of mind in your first abode.