Home buying is a daunting task, and if it’s the first time you are buying a home, the task becomes even more challenging. There are a lot of things that you need to do simultaneously, for example, finding the right home, landing a good real estate agent, applying for the most suitable loan option available and more. All these tasks can be very confusing and may even force you to procrastinate your home buying decision. However, to make your home buying decision easy and help you avoid committing the same mistakes most first time home buyers do, here are a few tips you should follow.
1. Decide Your Budget
To make your search more effective you must start by knowing how much you can afford or how much do you want to spend in buying a home. For calculating the amount that you want to spend, make a note of your monthly earnings as well as the monthly expenditure. While calculating your expenditure take into account the yearly payments such as car insurance, health insurance, and others, to get an exact idea of your spending.
2. Compare Home Loan Options Available
Comparing loans involve much more than comparing the monthly payments that one makes to the lenders. In addition to the monthly payments, there are a lot of other factors that you need to look at to get a fair idea of which loan works better for you. For example, if you are looking to buy a property in Texas and don’t have enough money for down-payment or your credit score does not qualify your for other home loans, Texas first-time home buyer is a great option for you to easily get a loan at competitive interest rates.
3. Consider Down-payment Cost
One of the costs that first-time home buyers usually struggle with is the down-payment. Most first-time home buyers do not have the corpus to make a down-payment as high as 20 percent of the home value. However, there are many home loan options available that can reduce your down-payment requirement. For example, a VA loan for veterans and their dependents does not even need a down-payment. However, as not everybody would fall into that category, there are other loan options also such as the Texas first-time home buyer loans, USDA loans, and others that have relaxed down-payment requirements.
4. Include all Additional Costs
When buying a home, there are many additional costs associated with it. Make sure you don’t forget to include costs such as closing costs, homeowner’s insurance, monthly insurance premiums, property taxes, any dues that may be applicable. It is important to calculate these costs to avoid any surprises at a later stage. Also, there are options available where you may not be required to pay certain costs such as closing costs, monthly insurance premiums, and others.
5. Consider Long Term factors
When buying a home, there are a lot of factors that you need to consider from a long-term perspective. Do you have a school nearby if you are planning to have kids, is there a hospital in the vicinity for your elderly parents who might stay with you in future, does the resale value of the property look promising in case you plan to sell it off and buy another property. You must consider all these and a lot of other such factors when buying a home.
To help first time homebuyers with suitable borrowing options, the federal government, and the states offer various first-time homebuyer loans to the borrowers. These loans come with attractive interest rates, low down payment, relaxed credit score requirements and more. If you are looking for help with home loans, get in touch with a home loan expert who guides you through the pros and cons of the loans available in the market.