For many people, becoming a homeowner is one of the most rewarding experiences you can have. It comes with a wealth of exciting decisions and opportunities, not to mention the pride you get from owning your own slice of the world. Read about Tips to Know Before Buying a House below.
Before you can choose a house, however, you have some organization to do. The steps you have to take before buying a house might not be as fun as the things that come after you sign the paperwork, but they’re extremely important.
Read on to learn a few tips that will teach you how to buy a house and avoid potential roadblocks along the way.
Set Your Budget
The first of your steps to buying a house should be to set a budget. Remember, there’s a difference between having enough money for something and being able to afford it.
You might have the money to pay for a $400,000 house, but when you work out your budget, you can only comfortably afford to pay $350,000. If this is the case, don’t worry, the median home price is only $329,000, so you’ll still have plenty of options.
Here’s a good rule of thumb: your mortgage payment (including insurance, taxes, and PMI) should not exceed 30% of your monthly income. This will ensure that you have enough money left over for expenses, savings, and entertainment.
Watch Your Local Real Estate Market
Keep an eye on the real estate market in the city where you’re looking to buy for a few weeks before you get serious about buying a house. Check out this website for an example of the type of site you should add to your bookmarks during the process.
You need to know how much the houses are typically going for, and how long they sit on the market before selling. In doing so, you’ll have a good idea of how much you’re going to have to spend and whether or not you need to anticipate the possibility of a bidding war.
Check Your Credit Score
Unlike selling a house, your credit score can make or break your experience buying a house. If you have poor credit, you’re going to pay more in interest, which can drastically raise your monthly expenses.
Take a few months to raise your credit score if you need to. Paying down debt is tough, but you’ll thank yourself when you’re able to get a better, more affordable offer from your mortgage company.
Have Your Ideal Home in Mind
This is the fun part. Before buying a house, you should have your ideal home in mind. Will you get exactly what you’re looking for? Probably not. But you’ll make the process easier on yourself by narrowing down your options.
Choose the type of house you want first (single-family home, townhouse, condo, etc.), then decide where you want to live.
Do you want to live on a quiet street or downtown in the middle of the action? How far do you want to be from work? What types of nearby amenities are a must?
Write down everything you want in a home, then use your list to compare possible options.
Make Time for Preparation Before Buying a House
When you’re approaching the prospect of buying a house, it’s easy to let your excitement run away with you. Now, there’s nothing wrong with a bit of excitement! You just need to ensure that you’re taking the proper steps as well.
By taking time to prepare before buying a house, you can create a roadmap that will make the process of buying a house smooth and stress-free. This will take some time, but you’ll be able to enjoy house hunting even more as a result.
In need of more advice for navigating the home buying process? Take a look at our blog!
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