In honor of National Movers Month, Â Connect Your Home would like to highlight some tips for purchasing your own home and making sure you keep it. Owning a home is a big responsibility and isnâ€™t a decision to jump into. It requires serious thought about whether or not you are ready for a commitment of this magnitude. Making the decision to buy a home can be one of the most exciting decisions of your life, make sure you are doing it in the right way. Here are a few things to consider before you make this big financial plunge.
- Know what you can comfortably afford: The first thing to keep in mind is that your new home shouldnâ€™t be one you canâ€™t afford. First step is to review your finances and your credit history. It is important to view your history through the eyes of the lender that will be approving yourÂ loan. In your decision also take into consideration the principal, interest, property taxes, homeownerâ€™s insurance and private mortgage insurance. This will help you make sure you will be able to cover the cost of your new home and have enough of a financial â€œcushionâ€ to live comfortably after that. The rule of thumb is that you can buy housing that runs about two-and-one half times your annual salary.
- Estimate Upfront Costs: Depending on the loan program you select, you may have to provide a down payment. You need to consider if you will need to pay closing costs, moving costs, home maintenance, or other expenses, be sure you have properly saved for this.
- Donâ€™t buy if you canâ€™t stay put: If you canâ€™t fully commit, donâ€™t think about buying. With the transaction costs of buying and selling a home, you may end up losing money if you sell any sooner even in a rising market.
- Buy in a district with good schools: In most areas, this advice applies even if you donâ€™t have school-age children. This can be a big decision maker, for other buyers if you are ever looking to sell your home.
- Choose carefully between points and rate: When picking a mortgage, you usually have the option of paying additional points. The portion of the interest that you pay at closing is in exchange for a lower interest rate. If you stay in the house for longer it is generally better to take the points. The lower the interest rate is, will save you more money in the long run. For this you should seek help from a professional before making any decisions.
- Before you start house hunting, get pre-approved: Getting pre-approved will save yourself the grief of looking at houses you canâ€™t afford and put you in a better position to make a serious offer when you do find the right house.
- Hire a home inspector: While your lender will require a home appraisal, it would be in your best interest to point out the potential problems that could require costly repairs down the road. You should hire an engineer with experience in doing home surveys in the area where you are buying.
Now that you have finally made the decision to purchase a home, you have a lot to look forward to. This can be one of the most rewarding and stressful decisions of your life. Take the time to really make sure you are making the right decision for you and your family. To learn more about National Movers Month visit us at Connect Your Home or call (888)566-3979.