6 Financial Considerations for Home Buyers!
Since for most the value of their house is their single largest financial asset, doesn’t it make sense for homebuyers to proceed wisely and mindfully throughout this process, especially from the perspectives of various financial considerations? After over 15 years as a licensed Realtor in New York State, I have witnessed how important this process is and seen many of the potential ramifications when all kinds of shortcuts are attempted/created! With that in mind, this article will briefly attempt to look, examine, review and discuss 6 of these considerations and why they are so important, etc.
1. Creditworthiness: Before starting the so-called hunt for his own home, he should carefully and thoroughly consider the full extent of his personal creditworthiness! What can be in one’s credit history that can make getting the best mortgage and terms on time less stressful? Go beyond just the credit score, but either yourself or have a trusted mortgage professional review it from the point of view of getting a mortgage and what steps would make sense and when, upfront, before you start! This will help guide you in figuring out what you’re qualified for and what you can afford, but don’t forget to consider your personal comfort zone as it relates to this process!
2. Down payment and closing costs: Although some types of mortgages allow for lower payments, a conventional mortgage typically requires 20% down! Do you have the necessary funds to do so, as well as the required payments known as Closing Costs (often many thousands of dollars, more)? If you do, will using your personal funds for this purpose have future implications in terms of preparing for repairs, renovations and home ownership contingencies?
3. Allow for monthly costs/expenses: How confident are you that you can comfortably afford the monthly costs and expenses of owning a home? Consider all expenses, including the mortgage (principal and interest payments), real estate taxes, escrow items (such as insurance, etc.) and savings to maintain reserves for contingencies such as repairs, renovations, upgrades, expenses related to with appliances etc!
4. Prepare for repair: Some repairs are predictable, some are normal and expected, and some may be unforeseen! A wise approach is to set up a separate account/fund specifically for repairs and put in a realistic amount, monthly, to insure yourself and be as prepared as possible!
5. Repairs and upgrades: Most people have some degree of individual taste and therefore almost every new home owner makes certain changes, especially in terms of decorating, repainting floors, painting, etc. Other repairs may include dealing with kitchen equipment and appliances, HVAC systems, etc. Also, many people decide they need to upgrade or make other changes/changes! Reality and the best approach must be prepared from the beginning!
6. Will you find home ownership part of the American dream or will it be a nightmare?: Doesn’t it make sense to try to make this event and the act of owning a home, of your home, as enjoyable as possible? The alternative, often, can be unnecessary stress!
Before considering buying a home, be as prepared and ready as possible! will you be
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