Owning a house is everybody’s dream. However, realizing this dream is easier said than done. There are many things that you need to consider while buying a home. Most importantly, you have to be sure about your monetary status for buying a home. If you have a transferable job, then it is always a better idea to rent a house instead of buying it. Before you decide on purchasing a home, you should ensure that the money and time you invest in are well-spent. Here’re some instructions and tips that will help you when you go for buying a house for yourself. Read on.
Complexity Level: Moderate
Time Required: 1-2weeks
Resources Required:
1. Money
2. Time to search for a house
Instructions:
1. Get a clear idea of what you want
Get a clear picture of the kind of house you want to have. Consider few things like number of family members, number of bedrooms required, if you want a garden or a backyard, if you need parking garage etc. It will be easier for you to buy a house once you know what you are looking for. Also, be clear about your budget. If you do not have a fixed budget, you may end up spending a lot more than you intended. Decide on the location in and around where you intend to buy a house. Keep in mind the places you visit frequently – work, gym, markets and your children’s school.
2. Have a strong credit
Decide if you want to rent out a house or buy it outright. If you are buying a house outright, you need to clear your credit debts. This will improve your FICO score and will determine how a lender will see you as a purchaser. Have a clear idea as to how much you will be able to take as a loan, and how much will you be able to pay by yourself.
3. Get a good real estate agent
You can take the help of a realtor if you want. Check the credentials of the realtor as well as his/her success rate. A good realtor will be able to guide you well when you buy a house. An agent with experience will be able to tell you whether a house is overpriced and whether you are getting your money’s worth. Tell your agent in details about what you are looking for in a house. He will be able to inform you of the available houses that meet all your requirements and are within your budget.
4. Take your time to search for a house
Do not rush for buying a house or you may end up buying one that does not meet all the requirements, which is overpriced or which is in poor condition. Also, you need to research the neighborhood to make sure you will be comfortable living there. Keep in mind the maintenance expenses while buying a house. Some houses are available at lower prices but might cost you a lot in maintenance. Visit open houses so that you can get an idea of all that is available in the market. Inspect the house you decide on carefully before you finalize a deal and make sure you are getting your money’s worth.
Frequently Asked Questions:
1. Do I need an agent while buying a home?
It is not necessary for you to have an agent while buying a home. However, if you are a first time home buyer, then it will be better for you to have a good agent because they will be able to guide you in buying a good house.
2. When do I need to apply for a loan?
A seller needs to be assured that a buyer can afford the house. It is a good idea to make applications for a loan and get the loan pre-approved. This should be ideally done before you contact the agent. This way, you and your agent will know what your maximum budget is and what you can afford to buy.
3. What is FICO? Why do I need it?
FICO is a credit scoring process that sums up all your credits and converts them into a 3 digit number. It is applicable in the United States. The scoring range is between 300 and 850. The higher your score, the better you will be considered as a buyer.
4. What do I need to know about the neighborhood before I buy a house?
You need to have a general idea of the neighborhood. Find out the kind of people who live there and if you will be comfortable among them. Also, find out if the neighborhood is close to markets, schools and other frequently-visited places. Also, it is important to find out about the crime rate in the neighborhood. The neighborhood will decide the resale value of the house, so choose wisely.
5. Is it necessary to visit open houses?
It is necessary to visit open houses if you want to get a good picture of what kinds of houses are available in the market. If you are considering a particular house for buying, visit it more than once.
6. How do I buy a house with a low income?
You can buy a house with low income if you get your expenditures and credits in order. You also need to save money for a down payment on the house. And, most of all, do not overreach; instead, buy a house that you can afford comfortably.
Quick Tips:
1. Ask your family and friends if they know a reliable lawyer, inspector or agent.
2. Get your loan pre-approved.
3. Find out about the house rates in the neighborhoods you plan to buy your house in.
4. Stick to your budget.
5. Keep the maintenance expenses in mind while buying the house.
6. A house inspection is absolutely recommended before you buy the house.
Things To Watch Out For:
1. Do not make haste in buying a house.
2. Have a clear idea of the mortgage costs before you buy a house or you may end up spending more than planned. Use a mortgage calculator available online.
3. Do not buy a house without an agent unless you know well about the trade-offs.
4. Do not get emotionally involved with a house you have visited, this may result in overshooting your budget.
5. Do not buy a house if you are always on the move. In this case, it will be better for you to rent one.
