Frankly speaking, when you happen to buy a house without asking the appropriate questions, you are likely to make some very costly mistakes in the long run. Say you are tired of living with your parents or your family is getting larger and would want to move to a new house, there are some very important questions to ask before signing the dotted lines. It is clear that most people tend to decide too early when trying to buy a house because in most cases, they tend to have fallen head over heels in love with the property and hence fall victim of some very avoidable and costly mistakes.
You can always carry out some personal research online with the aid of real estate information providers such as Zillow, Freddie Mac, and a host of others, but your final decision shouldn’t depend solely on everything you find on the internet. While the services of a commendable real estate expert can never be overemphasized in matters like this, we’ll in this article keep you informed on some issues to address before signing the papers of your new house.
DO I HAVE MONEY IN THE BANK?
Real estate investors in Seattle and Cofounders of Iwillbuyhouse, Viktor Rybachuk and Alexander Romanov stated that many lenders love it when you have a good amount of cash in the bank for your down payment. The general rule is that a prospective buyer should be able to provide a 20% down payment for a house they intend to purchase. However, there are financing options that allow for less than 20% of the original fee.
“Thing is, if as a buyer, you can afford a huge down payment, the amount of money you get to pay on monthly basis will be far less than that of someone who could only afford less,” Rybachuk added. Be sure to have extra cash for mortgage insurance, property taxes, and some others which will all amount to the closing costs of the house.
HOW HEALTHY IS MY CREDIT SCORE?
It’s no news that with a good credit score, you can secure a better loan to get a house of your choice. Buying a house with a low credit score is good news and also a very bad one. A federal housing administration loan can be applied for and gotten with a credit score as low as 500. However, to get a conventional mortgage loan approved, your lender may go for a credit score which is as low as 580 given you have a commendable debt-to-income ratio. What you might miss is the fact that with a low credit score, you get to pay higher interest rates and higher monthly payments.
WILL I HAVE MONEY LEFT AFTER THE PURCHASE?
When you were a tenant, you could easily call your landlord when problems arise and then your landlord bears the costs of whatever repairs your house needs but now you are a homeowner yourself and therefore, you bear all repairs yourself. Be sure to have a good amount of cash set aside for the many expenses that come with owning a house of your own.
In addition to what we have above, there are a couple of things to look out for when acquiring a new house. It cuts across individual preferences, ranging from price, size, location, features, and closeness to local amenities. Whatever the preferences may be, you’d want to consider acquiring a house that would continue to accumulate value in the long run.