Advice for First Time Home Buyers
No matter which part of this beautiful planet you live, to own a home is the fulfilment of every individual’s dream. This article will help you understand the process of buying home, especially for the first time home buyers. Being a first time home buyer is exciting but stressful and time consuming at the same time as average home buyers are around 35, a relatively young age for such a big financial decision.
When you start searching for your dream home, many questions will come to your mind. Buying a home is a major financial move, so we advise you to go carefully and look at all the pros and cons of home ownership. Below mentioned tips will help you throughout property buying process.
Don’t take decision in a hurry
First time home buyers often do such mistake. We know that you are excited to buy a home, but never take any buying decision in a hurry. You may feel tempted to buy a good looking home. But, make sure that you are getting the value for money. Check everything right from construction quality to amenities available before your close the deal. Get property inspected by real estate expert and check all the property related documents carefully.
Check your CIBIL Score in Advance
Be it salaried of self-employed, most of us need home loan to purchase property. To avail home loan you must check your credit score well in advance and maintain a good score to avoid your application being rejected. This is very important parameter for loan to be sanctioned, so be ready for it and maintain a good credit history.
Purchase for the long term
A home is a not just valuable investment but a dream for most of us. This is the place where you start your family life; raise your children, celebrate functions and spend quality time with family and friends. Many people who sold their homes recently had lived in their home for at least a decade before selling. Some people are living in the same home they bought ever. Find a home keeping in mind the future requirements.
Focus on affordable home
Focus on finding a home that you can afford. Make a list of non-negotiable features that meets your needs but don’t go for additional features that might break your budget. Make sure you find a good neighbourhood. You cannot compromise on hospital and school.
Fix a budget for home
It’s very important to set a budget and stick to it. Don’t go beyond 25% of your gross income. Don’t forget that home ownership comes with other investment like insurance, tax, maintenance, interiors etc. always aim for 20% down payment to avoid costly mortgage.Many people get attracted by luxurious features of the homes and tend to apply for a higher loan amount that becomes a headache for them later on while repaying EMI. Make sure you don’t compromise with your usual lifestyle for paying home loan EMI.
Keep a six-month backup
Future is uncertain and we hardly know what is going to happen next moment. So it’s very important to keep a backup for six month. We can see slowdown in business and may lose job any time. This reserve should cover six months of living expenses in case you get sick, face an unexpected expense or lose your job.
Pre-approved loan means you have already passed the approval process and almost sure that loan will be granted if you apply for it. Pre-approval process requires you to submit all the income related documents. Here bank will check your credit history and decides how much loan can be given to you. Interest rate differs bank to bank, so try to approach more than 1 bank to get lowest rate available.