4 Tips for First Time Home Buyers

August 24, 2012   ·   0 Comments

 

Buying a house for the first time does not need to be a scary prospect. Sure, it is a big undertaking with a lot of financial responsibility to go along with it, but with a little time and preparation, anyone can be a homeowner.

 

Here are 4 tips for first time home buyers:

 

Pay Off Your Debt

However, before you even start looking at any kind of property, no matter how big or small, you first need to pay off any outstanding debt. This is important for a few different reasons. First of all, unless you are sitting on a large pile of cash, you will need to take out a . In order to be in the best position for negotiating a on the most favorable terms for you, it is ideal for you to be debt free, and with a fantastic credit rating. If you have a lot of outstanding debt, or even if you have recently paid if off but your credit rating has not improved yet, take care of those things first. Even if it means delaying your home purchase for a year or two, you will be much better off in the long run if you are in a position to sign for a solid , with payments you can consistently afford. The other thing to keep in mind, is that your will become a monthly financial strain. In order to allow yourself to have the most money available for your payments, and thus give you more options in terms of the property you purchase, you want to free up as much money as possible. Having monthly debt payments will decrease the monthly money available for the . Pay it all off, and start your new life as a homeowner on the right foot!

 Read: No Prepayment charges on Floating Home Loans & Car Loans now

Figure Out Your Budget

To understand what is your budget you have to start by checking how big mortgage you can afford and how much you can pay on a mortgage down payment. Do a little research on real estate prices too. There is a common misconception that all home purchases must be conducted with the assistance of a super expensive real estate agent. While agents can be helpful for the search, and particularly for negotiating the legal aspects of the purchase, start doing a little research on your own, and save yourself a little cash when it comes to agency fees. There are many websites for this purpose, most of which are region-specific. For example, finding property for sale can be really easy with real estate search engines, which can help you to navigate the classified ad listings. Also don’t forget to include closing costs in your budget, which can add up to 5 precent of the total cost of your new home.

 Read: Things one must know before Taking a Home Loan

Choose the Right Mortgage

If you have a good, steady job and you don’t have any debt hanging over your head, you can probably buy a home with relatively small down payment. But remember that the bigger down payment you can make, the more mortgage options you will have. Also often you will be forced to pay for a private mortgage insurance if your down payment will be less than one fifth of your home’s value. Choose your mortgage wisely as your monthly mortgage payments will depend on all these different factors.

 Read: How to Choose the Best Loan When You Are In Bad Credit?

Government Assistance Programs

Another good thing to look into is government assistance programs to help you with a down payment. It depends on where you live, but there are quite a few programs, all around the world, designed to encourage home ownership. Of course, the government is not going to hand over a million dollars for a down payment, but there might be opportunities to get some assistance, either in the form of an outright payment or a tax credit, to help with your down payment and expand your property options.

Read: How Gold Loan scores over Personal Loan?

 

Like said before, property ownership is a scary prospect, but some simple planning and research can make it a possibility for anyone!

 

Author of the article is Mary Johnson from http://tothego.co.uk – a real estate search engine in the UK.

Rajesh Singla

Rajesh is the founder & CEO of Stockssavvy, Stocks analyst,financial advisor by choice,software engineer by fate,biker,gamer,cricket lover n enthusiastic person. He believes in doing things not just to get by but to get Ahead...

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