Get the most out of your money with these handy home buying tips.
9. Keep Your Money Where It Is
It’s not wise
to make any huge purchases or move your money around three to six months
before buying a new home. You don’t want to take any big chances with
your credit profile. Lenders need to see that you’re reliable and they
want a complete paper trail so that they can get you the best loan
possible. If you open new credit cards, amass too much debt or buy a lot
of big-ticket items, you’re going to have a hard time getting a loan.
8. Avoid a Border Dispute
It’s absolutely essential to get a
survey done on your property so you know exactly what you’re buying.
Knowing precisely where your property lines are may save you from a
potential dispute with your neighbours. Also, your property tax is likely
based on how much property you have, so it is best to have an accurate
map drawn up.
7. Bigger Isn’t Always Better
Everyone’s drawn to the
biggest, most beautiful house on the block. But bigger is usually not
better when it comes to houses. There’s an old adage in real estate that
says don’t buy the biggest, best house on the block. The largest house
only appeals to a very small audience and you never want to limit
potential buyers when you go to re-sell. Your home is only going to go
up in value as much as the other houses around you. If you pay 5.0 Million Lkr
for a home and your neighbours pay 2.5 to 3.0 Million Lkr your
appreciation is going to be limited. Sometimes it is best to is buy the
worst house on the block, because the worst house per square foot always
trades for more than the biggest house.
6. You’re Buying a House – Not Dating It
Buying a house based
on emotions is just going to break your heart. If you fall in love with
something, you might end up making some pretty bad financial decisions.
There’s a big difference between your emotions and your instincts.
Going with your instincts means that you recognize that you’re getting a
great house for a good value. Going with your emotions is being
obsessed with the paint colour or the backyard. It’s an investment, so
always stay calm and be wise.
5. Get Pre-Approved for Your Home Loan
There’s a big
difference between a buyer being pre-qualified and a buyer who has a
pre-approved mortgage. Anybody can get pre-qualified for a loan. Getting
pre-approved means a lender has looked at all of your financial
information and they’ve let you know how much you can afford and how
much they will lend you. Being pre-approved will save you a lot of time
and energy so you are not running around looking at houses you can't
afford. It also gives you the opportunity to shop around for the best
deal and the best interest rates.
Do your research: Learn about junk
fees, processing fees or points and make sure there aren’t any hidden
costs in the loan.
4. Don’t Try to Time the Market
Don’t obsess with trying to
time the market and figure out when is the best time to buy. Trying to
anticipate the housing market is impossible. The best time to buy is
when you find your perfect house and you can afford it. Real estate is
cyclical, it goes up and it goes down and it goes back up again. So, if
you try to wait for the perfect time, you’re probably going to miss out.
3. Avoid Hidden Costs
The difference between renting and
home ownership is the sleeper costs. Most people just focus on their
mortgage payment, but they also need to be aware of the other expenses
such as property taxes, utilities and other payments. New
home owners also need to be prepared to pay for repairs, maintenance and
potential property-tax increases. Make sure you budget for sleeper costs
so you’ll be covered and won’t risk losing your house.
2. Give Your House a Physical
Would you buy a car without checking under the hood? Of course you wouldn’t. Hire a home inspector.
It’ll cost about 10,000.00 Lkr, but could end up saving you thousands. A home
inspector’s sole responsibility is to provide you with information so
that you can make a decision as to whether or not to buy. It’s really
the only way to get an unbiased third-party opinion. If the inspector
does find any issues with the home, you can use it as a bargaining tool
for lowering the price of the home. It’s better to spend the money up
front on an inspector than to find out later you have to spend a
fortune.
1. Stalk the Neighborhood
Before you buy, get the lay of the
land – drop by morning noon and night. Many home buyers have become
completely distraught because they thought they found the perfect home,
only to find out the neighbourhood wasn’t for them. Drive by the house at
all hours of the day to see what’s happening in the neighbourhood. Do
your regular commute from the house to make sure it is something you can
deal with on a daily basis. Find out how far it is to the nearest
grocery store, railway station, bus stop and many other services. Even if you don’t have kids, research
the schools because it affects the value of your home in a very big way.
If you buy a house in a good school area and below par or bad school area
even in the same town, the value can be affected as much as 20 percent.
Happy Buying.
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