So, you are all set to buy your new house! Congratulations on that!
Getting a new house is one of the most important decisions people make. Of course, it will not be an easy decision to find the right home for yourself and your family.
Of course, you need to consider a thousand things before investing your life savings in a piece of property.
Buying a new home will drain your energy from setting your budget right to hiring the best home value estimator.
To help narrow your choices, we talked with property experts to get ideas on what we should consider before buying a house.
Here’s a summary of what we discovered.
1. Get a Professional Home Inspector
You must be sure that the property you invest in does not have problems that might easily cost a few thousand bucks to fix.
Only a professional home inspector can do this job for you. An inspector visits the property and thoroughly checks every nook and corner of the house.
Everything is carefully tested for faults, from landscape to wiring to plumbing to roof.
If an inspector reports any faults, you can ask the seller to repair these, or you can simply pull out of the deal.
2. Keep the Hidden Costs in Mind
The purchase price is not the only cost you will pay for your house. There are a lot of hidden costs that you must incur before you can move into your new abode.
Once you finalize the deal, homeowners’ insurance will add their charges to your monthly bills. Furnishing the new home will also drain your bank account. Moving expenses, taxes, insurance, HOAs, and closing costs are just a few extra charges you must pay when buying your home.
Consider all these hidden costs when making up your budget, or be ready for a nasty surprise that will leave your pockets empty.
3. Can You Earn From Your House?
Paying back the mortgage feels like an intimidating task. However, there is a way your house can help you return some of the mortgage value.
Living alone, you can rent a room through a simple ad on Airbnb. After the mortgage payment is made, this might even become an income stream for you.
So, our advice here is to know the rent you can receive in the area you are buying your house in.
4. Understand All the Paperwork
You can make a relatively accurate estimate of the cost of your home, but understanding the paperwork is equally essential. The number of paperwork banks ask for will blow you away.
Let us say you transfer your down payment to your primary checking account.
For each transaction, you owe the bank an explanation of where the money came from. So, to avoid irritating phone calls and paperwork, do the transfers earlier or send the amount in one go.
It is just an example of how tedious dealing with the bank can get.
5. Know About the Warranties
Make a list of all major home appliances and note if the warranties still cover them. Your dishwasher, refrigerator, washing machine, or HVAC unit may still have some days before the warranty expires. If you know the warranties on these items, it might save you a few bucks.
The water heater and air conditioning need to be replaced regularly. Ask the previous homeowner about the last time they were changed or repaired.
If they are about to reach their 10th anniversary, you will have a major plumbing expense right after you move in.
6. Enquire About First-Time-Home-Buyer Loan Programs
Government offers many incentives to those looking to buy their first home. Usually, when a person invests in real estate, they need to pay around 20% to 25% down payment.
As part of first-time-home-buyer loan programs, the down payment can go down to just 3% to 5%.
So, you may consider purchasing a multi-unit instead of buying a single-family home. You can rent out the extra unit and use the rent to pay off the mortgage.
7. Know The Cost of Legal Advice
Understanding the legal fees in the buying process is also very crucial. The cost of getting legal advice about your property can have significant fluctuations depending on the service quality.
The cost of legal advice can quickly spill out if you do not have a clear understanding of it.
Many thought processes will go in before you land on your final decision. We hope the factors mentioned above will help you narrow your choices.
Educate yourself before you invest your life savings. It will make your decision easy, and you will be more relaxed about the output you are about to receive.