When you buy a new house you will quickly realise that buying a home is not a cheap process. With the down payment, the home inspection and the loan approval process you can wipe out all your savings even before you get the keys of your new home.
These expenses can be difficult to control for the first-time home buyers who is inexperienced in this process. However, by education yourself you can avoid these mistakes and eventually save yourself a good amount of money
- Not Knowing Pre-approved Loan Amount
One of the first thing you can do is to check how much loan you can get from the bank. You must know what you can afford and what the EMI’s look like. A good mortgage broker can figure this out for you can directly submit the papers in bank and check the loan eligibility. Be realistic about what you can afford and don’t overextend yourself. Once you know the loan amount you will also be a stronger buyer when making the offer.
- Not Taking Advice From an Experienced Professional
Even if there is so much information available online, you should still seek the advice of an experienced professional in the early stage of your home-buying process. They can give you valuable insight of the property and neighbourhood you are looking at. At properresident we can help you throughout the process of buying your dream home.
A buyer’s agent can guide you in the right direction, help negotiate the price, counter an offer, and organize the closing process. And since the seller/builder pays both agent’s commissions (buyer’s agent or sellers agent), it only makes sense to have an agent on your side.
- Overspending On a House
Lenders determine loan amount based on the information listed on your credit report and your tax documentation. But sometimes, they approve applicants for a loan larger than they can afford.
Rather than being excited and accepting the higher mortgage loan, be smart and stick to your original price range. Getting more than expected loan provides immediate excitement and gratification- but your mood can quickly turn sour once the EMI’s starting rolling in. A big house typically equals expensive utilities, which can affect your disposable income and complicate your financial goals.
- Ignoring The Home Inspection
Home inspections are not required when buying a house, and some builders/sellers can rush the process and avoid an inspection. But buying a house without an inspection is very risky because serious problems can exist with the wiring, plumbing, the roof, or the foundation. An inspector can identify problems before the closing, and you can then ask the builder to fix these problems. If you buy a house and skip the home inspection, you’re financially responsible for any problems that arise after closing.
- Not Visiting the Property Multiple Times
There’s nothing wrong with bidding on the first house that you see. However, plan to visit the property at least thrice before submitting your offer. If a builder/seller is motivated and ready to sell, he or she may rush the process or try to force you to make a quick decision. But remember, once you sign the closing papers, there’s no turning back.
After the initial visit to the property, go home and return a few days later. In the meantime, drive through and check out the neighborhood during the weekends and evenings. Are the neighbors rowdy? Are the children playing in the streets or being noisy? Is there loud music in any house? Checking out the neighborhood when the majority of the residents are home can help you determine whether the area is a good fit for you and your family.
- Limiting Your Search To Specific City or Neighborhood
The majority of buyers have their hearts set on a certain neighborhood or city. But why limit your search area? Some home buyers want to live close to their place of occupation, or keep their children in a specific school of city. Regardless, it’s worth checking out other areas. It’s possible for your child to excel in another school, and the extra time that it takes to commute to work may present the opportunity to decompress before arriving home.
- Not Thinking About the Future
It’s nearly impossible to perfectly predict the future of your chosen area, but paying attention to the information that is available to you now can help you avoid unpleasant surprises down the road.
Some questions you should ask about your prospective property include:
- What kind of development plans are there in the future?
- Is the street likely to become a major street or a popular rush-hour shortcut?
- Is there talk of a bridge or a highway to be built very nearby in three years?
- What are the zoning laws in the area?
- Is there a lot of undeveloped lands around your area? Whom does it belong? What is likely to get built there?
