We all dream of buying a house of our own. It brings us a huge sense of accomplishment when we can have a property of our own. Moreover, possessing real estate is a safe and wise investment in the long run. However, if you’re buying a house for the first time, you can easily get confused. Purchasing a house isn’t as easy as it seems. This is why we’ve created 9 tips for first-time home buyers.
#1. Emergency Fund
It’s crucial to have no outstanding debts when you’re venturing into real estate. Investing in a house is no joke and therefore, you must have no outstanding loans or debts. Additionally, you’ll need money for insurance, maintenance, furnishing, etc. and therefore, you must have an emergency fund.
#2. Understand Your Needs
What kind of house do you want to settle in? Do you visualise yourself living in a studio apartment, a villa, a bungalow or an apartment? Before you actually go to purchase the house, it’s necessary to understand your needs and preferences. Take your budget, workplace distance, family size into consideration when deciding the kind of house you want.
#3. Plan a Budget
You need to have a stipulated budget. To create a budget, evaluate factors like your financial condition, source of income and existing assets. Compute the figure after setting aside a substantial sum of money for emergencies (emergency fund). Once you have a budget, remember to stick to it.
#4. Have Money For Down Payments
If you’re considering applying for a home loan, it’s wise to have the down payment ready. This way, you get a head-start for repaying the debt and gives you brownie points when securing a home loan from a bank. Additionally, it saves you from all the hassles of mortgage insurance.
You must have a sufficient sum of money to cover up the closing costs. They’re equally important and include:
- Home insurance
- Credit report
- Home inspection
#5. Watch Your Credit Score and have a Preapproved Loan
A pre-approved home loan shows your willingness to buy a good house. You’ll need a good credit score to be able to secure a home loan. If you’re buying a house for the first time, it’s natural that you’ll be looking for reputed loan facilities that have an affordable interest rate. A CIBIL score of 750 and above is necessary if you want to easily get a home loan.
#6. Start House Hunting
Once you have all the financial aspects taken care of, comes the time to start seeing potential houses. Hire a reliable realtor who understands what you want. Then, assess the houses on sale to find the perfect one for you. Consider conducting a comparative analysis to narrow down the options.
#7. Survey the Locality and Neighbourhood
We all want to live in a safe neighbourhood. When visiting the house, evaluate the kind of neighbourhood the house is situated in. assess the locality and the people residing in that area. Check if there are all the amenities such as transportation facilities, medicine shops, schools and grocery stores.
#8. Seal the Deal
Once you have zeroed in on your dream house, it’s time to go purchase it. Consult your realtor before proceeding with the closing costs and prepare the funds accordingly. Also, talk to the house owner or builder to help you through the purchase formalities.
#9. Examine the Purchase Documents
You must pay attention to go through the legal documents. It’s probably best to consult a lawyer to see that the lease agreement or purchase contract, loan documents and the house blueprint are in place. Only then, you should go ahead with the purchase.
Buying a house can be daunting but not if you educate yourself and understand the things you need to be aware of as a first-time home buyer.
WRITTEN BY SHRISTI PATNI