Searching for your first home can be exciting and sometimes a little scary. It’s generally the largest expense most people will ever make, so it really pays to do your homework, and arm yourself with knowledge and a team of professionals who can help you avoid the pitfalls some first-time homebuyers find themselves making.
With mortgage rates fluctuating, it’s more important than ever to understand exactly how much you will need for a down payment and for monthly payments once you move into a new home. A good rule of thumb is to spend no more than 35% of your monthly gross income – which should take into account annual property taxes, insurance and maintenance – all costs associated with owning a home.
Here are some other missteps to avoid on the path to homeownership:
If you don’t plan to make an all-cash offer – something only about 25% of buyers do these days – it’s smart to become pre-approved for a loan from a financial institution. That means talking with a lender to understand how much of a loan you will qualify for before making an offer. Getting pre-approved typically requires a detailed look into your financial history. It also involves a commitment to loan you a certain amount of money which is usually subject to a sales contract and an appraisal.
While the real estate market is finally cooling off in many U.S. cities, prices still remain higher than in years past. So much of the home-buying process can be emotional, so it’s better not to set yourself up for disappointment. That means not touring homes – either online and in person – that are over your budget. It’s also important to communicate this clearly to your real estate agent or broker. They need to understand that your budget is not flexible and you plan to stay within a specific amount.
When determining how much to set aside to cover total home costs each month, we recommend adding in property taxes and homeowners insurance to the mix. Depending on the age of your home, where you live, and how close you are to an area known for extreme weather events, your mortgage payment could increase by hundreds or thousands more each month. Other annual costs to consider include homeowner association fees and the cost for lawn maintenance if you don’t already own a lawnmower. If you have a pool or hot tub, factor in the cost of water treatment throughout the year. Don’t forget to also set aside cash for other home maintenance issues that will eventually pop up such as upkeep or replacement of your HVAC system.
When it comes to securing your dream home, it’s best to follow your head and not your heart. That means no matter how fantastic a property looks on the outside, it’s impossible to know exactly what may be lurking behind the walls (or under the sink) of a house or apartment that’s not new construction. From wood rot to termites to hidden water damage, your second story bathroom tub could be just one bubble bath away from falling through the ceiling. While that’s a dramatic example, a professional home inspection should be non-negotiable. If you don’t know a home inspector, ask your agent, family and friends for recommendations.
Category: Home Ownership
Are you preparing to find your dream house? Before you make the giant leap, here are 5 Tips to Get Ready for a Move:
Do you have a list of things that need to be fixed or updated around the house? Well, now may be the perfect time! For a variety of reasons, early fall is a great time of year to make home improvements. The days are still warm enough to tackle outdoor projects or leave the windows open, the kids are back in school, and contractors may be more available for certain types of projects.
There’s a common misconception that life insurance is only for those married with children.
Whether you’re considering your first home purchase or a move from your current home, there are several options available. Choosing a single family house, a multifamily property, or a condominium all have pros and cons. As you begin hunting for the perfect dwelling, be open to the possibilities.
Home insurance is required with most mortgages and provides wide-reaching protection to you and your family. If your house is ever damaged or destroyed, you would still be responsible for making your mortgage payments. Homeowners Insurance helps protect your personal finances and provides peace-of-mind to your family.
It’s official, spring is really here! Soon you’ll be opening windows to let in fresh air. Many families dive into spring cleaning and home improvement projects in the spring. Here are some home improvement projects that make sense this time of year:
Is anyone else confused at how it is already 2022?! Growing up, I always felt that the years were so much longer. However, the older I get the more I realize how quickly each day goes by. I began my career at the credit union when I was young and fresh out of college. Now, I am in my late 20’s and my back pops when I bend over!
Has it been a few years since you purchased your home? Things may have changed for you since you made that commitment to a 30-year mortgage – your income and credit score could have gone up. Interest rates may have gone down. Now is a great time to see if refinancing your mortgage makes sense for you!
Don’t fall into these traps when purchasing your first house. Searching for your first home can be exciting and sometimes a little scary. It’s generally the largest expense most people will ever make, so it really pays to do your homework, and arm yourself with knowledge and a team of professionals who can help you avoid the pitfalls some first-time homebuyers find themselves making.
Simple ways to add value to your home. It’s a seller’s housing market, but that doesn’t mean you have to be complacent about your home’s value. Here are several projects that can add value to your home, so that when you do decide to sell, you’ll get the best offers possible.
A lot of times when people think of home equity, they think of fixing or renovating their house. Did you know you can use that money for things that aren’t house related?
Purchasing your first home and becoming a first-time homeowner is a significant milestone. While the prospect of becoming a first-time homeowner can be exciting, it can also be intimidating. The more information you have about buying a home, the better position you will be in. Here are five tips to help you in your home search.
Home equity is the value of a homeowner's interest in their home. It is calculated as the difference between the home's current market value and the outstanding balance of any mortgages or liens on the property. For example, if your home is worth $300,000 and you owe $200,000 on your mortgage, your home’s equity is $100,000.