Purchasing your first home can be a daunting yet very exciting experience. The process, however, is not always a straightforward one. There are certain steps you need to take in order to prepare for such an enormous purchase.
Buying a home is, after all, one of the biggest investments you will make in your lifetime and is nothing to sneeze at. It’s important to know what to look for as a first time home buyer.
10 tips for first-time home buyers
Listed below are ten tips to help you prepare for your investment and how to make the best possible choice for yourself and your future.
1. Credit score
If you are fortunate enough, you may have saved a substantial amount of money, or you are gifted with an upfront payment from a loved one. If not, you will have to take out a loan to fund your purchase.
You won’t be able to get a home loan, or any loan, for that matter, unless your credit score is good or excellent. Start by checking your current credit score. If you don’t have credit, you can start by purchasing a credit builder credit card or opening a few credit accounts to help build your credit.
2. Get pre-approved
Getting pre-approved puts you in a better position to start shopping for your dream home. You can approach your bank for pre-approval.
3. Know the costs
Purchasing a home comes with a variety of other costs. It’s not as simple as making an offer to purchase. You need to be realistic about affordability as you’ll most likely have to pay rates and taxes in addition to your monthly repayment. A real estate agency can help! In addition, other costs of purchasing a home include:
- Property transfer costs
- Bond registration costs
- Levies (sectional title property)
4. Know the area
Do your homework before deciding on a home. Consider the location. How far is it from schools, shopping malls, and work, and what amenities are close by?
5. House plans
Ask for house plans to ensure that the current property and outside structures match the original house plans. Some homeowners extend their property without proper plans, and you may have a lot of headaches if the plans do not match the structure.
6. Clearance and Compliance
When purchasing a home, the home seller will need to provide certain clearance and compliance certificates. Do your homework on what is required in your specific area and request this before making an offer. You may have the process delayed if these documents are unavailable.
7. Defects
Are there any defects in the home? Does the roof need to be replaced? Or the flooring? You can use these to negotiate a lower selling price.
8. Repayment
Whenever possible, try to select the shortest payment period. This will substantially reduce the interest you will pay back on the loan.
9. Read the offer to purchase
Make sure you read and understand every line in the offer-to-purchase agreement before you sign anything.
10. Agents
Always work with reputable real estate agents.
Contact us at Phillip Fehler Realtor NorthGroup for more tips and advice on purchasing your first or next home.