Buying a house is exciting, emotional as well as stressful. Whether you are a first-time buyer or have experience in buying homes, it will always be everyday stress. Even though you try hard to have done all things smoothly, you may face several hurdles. For instance, a seller can be argumentative, a home inspector can reveal defects, lenders may turn down your loan, you might not have deposits, and the like.
Many borrowers say moving home is as painful as bereavement and getting divorced. What makes moving a house is so stressful and complicated? You want every corner the same way as you desire, but it is not a task of a few days. It may take several months or a year, and until then you have to hold a lot of patience, which you may lose due to the following reasons such as bamboozling documentation, disagreement over property, longer wait, miscommunication etc.
No matter how hard you try, some aspects of moving home are beyond control. However, you can still whittle down your stress. Here are some crucial tips:
Assess your home-buying need is genuine
Before you set in motion, you should be sure that you want to buy a dream house for a valid reason. Ask yourself the following questions:
- Do you want to stay in a current location?
- Do you know where you want to live and what you want?
- Is your job secure?
- Do you have enough money as a deposit?
- Do you have a good credit score?
- Will you be able to make additional expenses?
If you doubt due to any reason, you should cancel the plan of moving house. If the answers to all questions are yes, you should know how you want your home to be. Make a list of the following things like some bedrooms and bathrooms, type of exterior, interior decoration, furniture, type of housing, distance from your workplace, neighbourhood, building maintenance amount, distance to shopping complexes, schools, colleges and universities etc.
Prepare your finances
Once you have come to know what you need and what you want, the next step is to arrange funds. It is one of the most expensive purchases. You must have a complete idea of money you need to invest in your house so that you do not fall short of cash halfway through construction or moving house.
Look over all of your income sources, ask them to know revenues you generate every month. Deduct all of your regular expenses to know your net worth. Add it to your savings that you may have been building up for years.
Talk to mortgage lenders. Please note that each lender follows a different policy. Make sure that you choose the lender who offers the best mortgage deal. Talk to them, tell them your financial condition; they will consider your income statement, creditworthiness and the amount of deposit you will pay as down payment. Having found all these factors, your lender will let you know how much you could borrow, interest rate, and total repayments.
Direct lenders also provide mortgage calculators that you can use to know about your deal. All you need to do is fill out particulars like your annual income, additional income, monthly commitments, property value, deposit, and mortgage terms. These particulars may vary from lender to lender, but more or less, they remain the same.
The calculator usually reflects the estimated cost of your mortgage. It will give you an idea of how much money you will be able to afford.
Look over your credit report
Mortgage lenders approve a loan application after checking your creditworthiness. If your credit score is not stellar, the lender will not accept your application. Here is the credit rating by Experian:
The higher the score, the better the mortgage deal will be. However, creditworthiness is not the leading factor to decide on the disbursal limit and interest rates. If your credit score is less-than-fair, you will not have your application approved.
Before you apply for a mortgage online, you should request credit bureaus to get your credit report. You are likely to have some errors in your statement that may damage your score. Peruse your report to detect any default that you do not recognise, or you have not made.
If you have already been juggling with multiple credit card bills and debts, your priority should settle all of your dues. However, this will not be enough to improve your credit score. To build credit, you should take out a loan, especially a long-term loan that may span from 12 to 36 months.
Make sure that you repay all the instalments on time. Even if you have missed a repayment, you do not need to panic because your lender will inform of your default after 30 days from the scheduled date. Therefore, you can pay off the instalment within that period, but you will end up paying late payment fees.
Once you have built your credit, your mortgage lender will approve your loan application at once.
Listen to your realtor
Home search brings frustration if you do not find the option that you want to buy, but you can keep it at bay if you consult your real estate agent. The realtor knows better than you do. They will pull together various options based on your budget.
You have to tell them the location in which you want your dream house. The realtor will also save a lot of money in home inspection, labour, sale price etc. You can also search online to find homes of your interest and tell your estate agent.
Moving home is not as easy as pie, but you will get ultimate satisfaction when you get the title of your home. Follow the tips above to keep stress at bay. Ponder over your needs, take the decision correctly, choose the best mortgage deal and get into a house of your dream.