The decision to buy a house is exciting and emotional, but you have to remain rational and remember that your choice will affect your life for many years. Before you get the keys and sign away 20 or 30 years of mortgage payments, give it some thought: there are several things every prospective homeowner should know. Here’s what we wish we knew before we bought our first home:
1. You don’t need a big house
Unless you live alone or plan on having a large family, why buy a huge place? Bigger isn’t always better. In this case, more space means higher prices and larger utility bills. Plus, if you end up not filling all that space with furniture or other possessions, what was the point?
2. Location, location, location
This adage is especially true when it comes to real estate. Think about what you need and want in a neighborhood: proximity to work, schools, shopping, public transportation, etc. Be realistic about your needs and wants; if you can’t afford to live in the heart of the city, don’t be too picky about your suburban surroundings.
3. Don’t buy until you’re ready
The decision to become a homeowner should never be taken lightly. It’s a big responsibility that will affect your life for years to come. Make sure you’re emotionally and financially ready before jumping into the market; buying a house just because everyone else is doing it could lead to disaster down the road.
4. Get pre-approved for a mortgage
One of the first steps in the buying process is to get pre-approved for a mortgage. Look for trustworthy mortgage lenders such as Supreme Lending. Getting pre-approved for a mortgage will tell you how much money you’re eligible to borrow and will give you an idea of your monthly payments. Don’t start house hunting until you’ve done this. It will save you time and hassle down the road.
5. Have an emergency fund
No one ever plans on needing emergency funds, but life happens, and sometimes things go wrong. That’s why it’s crucial to have at least three to six months’ worth of living expenses saved up in case of a job loss, medical emergency, or other unforeseen events. If you’re buying a house and haven’t saved up enough money to cover these costs, don’t buy — wait until you can afford it.
6. Don’t be afraid to make compromises
If the home of your dreams is out of your price range, don’t let that stop you from finding something in your price range. There’s an equally undesirable trade-off fore’s an equally undesirable trade-off for every item on your wish list: if a house has a great yard but bad kitchen appliances, be prepared to purchase new appliances or learn how to do them yourself. If you’re in love with one house but not another, look for something in the “maybe” pile instead of giving up altogether. In the end, anything will be better than nothing
7. You’ll need renter’s insurance
Even if you’re not renting right now, it’s a good idea to have renter’s insurance. This type of policy will protect your belongings in case of fire, theft, or other disasters. Most homeowner’s policies don’t cover renters’ possessions, so it’s important to have your own policy in place.
8. Don’t be afraid to ask for help
Many professionals can help you through the buying process: real estate agents, mortgage brokers, attorneys, and home inspectors. Don’t be afraid to ask for their advice—they’re there to help.
9. It will take longer than you think
The buying process usually takes at least a few months, so don’t expect to buy a house and move in the same week. If you’re in a hurry, you might want to consider renting instead of buying.
10. It’s not always a good investment
Despite what you may have heard, buying a home is not always a good investment. It can be more financially beneficial to rent than to ow in some cases. Do your homework and crunch the numbers before making any decisions.
11. You’ll need to pay property taxes
One of the drawbacks of homeownership is that you’ll have to start paying property taxes. These taxes go toward maintaining public services and infrastructure in your neighborhood, so it’s important to know how much they will cost you.
12. You’ll be responsible for repairs
When you’re a homeowner, you’re responsible for all repairs and maintenance on the property. This can be both costly and time-consuming, so be prepared for it before making the jump.
These are just a few things to keep in mind when starting the homeownership process. By knowing what to expect, you’ll be better prepared for what’s to come. So don’t be afraid to ask questions or get help from professionals. They’re there to make the process easier for you.