When you are considering buying a home for the first time, the options involved can be overwhelming. However, the questions of neighborhood, house size, mortgage, etc. become much simpler if you proceed one step at a time. Buying your first home is a truly exciting event and if you know your options and your preferences, you can reduce your stress and enjoy the experience.
There are many important questions you should answer before beginning the process of buying your first home, but here are the five questions that are most important.
FIVE QUESTIONS FOR FIRST-TIME HOME BUYERS
- What type of home best suits your needs? A traditional-single family home is not your only option when you are purchasing residential property. You could also consider a condo, a townhouse or a multi-family building. You just need to decide which kind of residence would be the most convenient and suited to your lifestyle.
- What features would your ideal home have? It is helpful to have a picture in your mind of what you most desire when looking at new homes. It is always good to have a list of your preferences before you begin a home search as there are usually too many options to simply wing it. This question can cover everything from desired neighborhoods to how many bedrooms you need to whether you would like a basement.
- How much mortgage do you qualify for? Before you even begin to look for new homes, it is important to find out how much a lender would be willing to loan you. You don’t want to waste your time looking at $300,000 homes when you would only be approved for a $200,000 loan. Some of the factors that apply to your qualification for a loan include your monthly income, how long you’ve been employed at your current job and how much debt you have.
- How much house can you afford? It is important to consider the total cost of the house as well as the monthly payments included in the cost. Calculate how high the property taxes are in your desired neighborhood as well. You should have a defined payment plan or a monthly budget calculation in mind when you are considering your home buying options. Occasionally, you can qualify for a loan that is actually more than you really need so it is important to understand your budget. When calculating your budget, it is beneficial to add in an estimate for insurance, maintenance or improvement as well as closing costs for your new home.
- What type of mortgage works best for you? First-time home buyers have a wide variety of financing options. Your mortgage interest rate will have a huge impact on the final price of your home, so you should know your options and shop around. Calculating your own debt-to-income ratio can help you understand what size loan this will earn you. Mortgage consideration is extremely important. It is most beneficial to have your financing in place before you even begin to look at houses, as they can sell quickly.
If you consider all of your options and answer these key questions before you begin your home search, you will keep yourself from becoming overwhelmed and making an uninformed decision. You will be able to narrow your search and understand what you can afford. One of the most important elements of your search is finding the right mortgage loan and lender. The right mortgage will ensure that you get the home of your dreams and a good mortgage lender will partner with you to help you achieve your goals.