Advice For First-Time Homebuyers

Posted on Oct 11 2013 - 3:47pm by Devika Arora

House

We all know that house-hunting can be quite a tedious and daunting task, but that should not mean that in order to end the quest you rush in to buy the first house that you come across or completely give up the idea of owning a property. The search for the perfect real estate can take weeks to reap results, so if you are a potential home owner who is seeking to acquire a house for the first time patience and preparation is what you need. Here are a few tips that will help you ease the entire process of home search.

Think of a budget

“How much money can I spend on the new house?” This is the first question you need to ask yourself before going for house-shopping. You can easily show up at a pretty house and then fall for it, but why waste precious time when that house is way too expensive to fit in your price range? You wouldn’t want to find your dream home just to realize it can’t be yours!

To calculate your housing budget, start by analysing monthly expenditure. Note down all daily expenses over a course of four weeks. Calculate your savings and see how long it may take you to amass a down payment.

As for the home loans, calculate the exact amount of finance that you need and can pay off comfortably. Just because the bank is ready to give you more money doesn’t mean you should borrow it.
Make a realistic wishlist

On the basis of the prepared budget and considering the desired location, create a list of the amenities you would want to have in your house. A thorough research for this list will help you get realistic answers. Check out some properties in your budget to know the type of facilities that are available within your range. Your tight budget may not grant you the best of looks and luxuries, so if your pocket doesn’t allow it don’t splurge the money. You will always have time to upgrade at a later stage.

Seek pre-approval for a mortgage

Many real estate deals that depend on loans fall apart as the buyers don’t find a financial institution to grant them a mortgage. Getting pre-approved will help you steer clear of such a situation. Start discussions with at least three types of lenders,like big national banks, regional banks,mortgage brokers, local lenders and a credit union. Surf the internet to find a list of lenders near you. Also check out their estimated rates and payments.

Compare some loans from various lenders and opt for the plan most suitable for you. Certain lenders may charge for pre-approving your loan application, so make sure you ask about all costs in advance. The banks will need your credit card details and an insight into your assets and income.Pre-approvals are usually valid for two to three months so find a house within the period, else you will have to re-qualify.

Hire a home inspector

A good home inspector may help you save thousands of dollars in the long haul. Ask your real estate agent for referrals and interview the potential candidates. Find out the processes adopted by them and the paperwork you can avail after the inspection is completed.

Check out the neighbourhood before buying

Interact with the neighbours to get a fair idea of what it’s like to live in that colony. Bad neighbours won’t affect the value of a property, but having good neighbours can be a priceless resource for first-time home buyers. They may even spill the beans about the house you are considering to buy, or give some pros and cons of the area. Also, before you buy check out the nearby facilities that can make living in the area more comfortable.

Photo Credit: Flickr/Elliott Brown

About the Author
Devika Arora

Devika Arora has been writing resourceful articles on behalf of 99acres.com for the avid readers who wish to learn more about Indian real estate.