Purchasing a new or second-hand home is not a decision that should be taken lightly. According to Harper Management experts, there are a series of recommendations that you should follow to get the best home you can find. What are the tips for buying your first home? We tell you all about them!
Tips For Buying Your First Home
An apartment or a single-family home? In the city or on the outskirts? which mortgage is better? These are just some of the questions that may arise if you are looking for advice on buying your first home. What do you have to take into account when it comes to purchasing a property?
Make A Realistic Budget
One of the first tips for buying your first home is to make a realistic budget for the home you want to buy. Here you must take into account not only the amount of the property but also the expenses associated with the sale. The purchase of a property includes, in addition to the purchase price, paying taxes, the deeds of the house, the procedures before the notary, and the Property Registry.
When making a budget, you should also take into account the mortgage you are going to take out and whether you can afford to pay the monthly payments. If you need any kind of help to sell or buy a house for cash you can contact Minnesota Home Guys.
Fixed Or Variable Interest?
Another tip for buying your first home is the type of mortgage you are going to take out. Mortgage payments should also be within your budget. Here you must take into account your debt capacity, that is, that you can afford the monthly mortgage payment for as long as the mortgage loan is valid.
And what type of mortgage is best to co-contract? It all depends on your income and the cost you can bear. Fixed-rate mortgages are somewhat higher than variable-rate mortgages, which present some uncertainty. But there is also the possibility of taking out a mixed type mortgage, which is a mix between fixed and variable.
The monthly mortgage payments should not be greater than 30% of your income, although this is a study that the bank also does when granting or not granting a mortgage.
Savings For Purchase
Before embarking on the purchase of a home and choosing the mortgage, it is necessary to have savings to face the expenses derived from the purchase and sale. We start by telling you that banks do not grant 100% of the amount of the home, but approximately 80%. That is, you must have the other remaining 20%.
You must deliver the first 10% at the time of signing the deposit contract that serves as a “reserve” for the home; Through this contract, the parties undertake to carry out the commercial transaction. The other 10% must be delivered at the time of formalizing the contract before a notary.
Compare Prices In The Area
Once you have a clear budget, as well as the type of mortgage you want to take out, it is time to look for a house that suits your needs. If it is a flat or a single-family home, semi-detached or chalet; you must also take into account the services that are around the area where you are going to buy the home. For example, if you have supermarkets, schools, hospitals, and parks nearby.
When you have chosen the area and verified the services, as well as the type of property, it is a good idea to shop around for prices. You have several online portals to compare prices in the area.
Home Inspection
One of the tips for buying your first home is not to buy the first house you see. You must search several homes, comparing areas, prices, etc. It is advisable to visit several properties and learn everything about the properties that interest you the most.
It is essential to pay attention to everything and ask the relevant questions at the real estate agency or the owner. Ask basic questions such as the total built and useful area, even the condition of the boilers, or supply costs, among others.
Legal Status Of The Home
Before signing any deposit contract, you must verify the legal status of the home. It is possible that, for example, the property is not registered in the Property Registry or that it is in the name of a former owner. Therefore, the sale cannot be carried out. It is also possible that the home has encumbrances, such as unpaid taxes, a lien, or a mortgage that has not yet been finalized.
Prepare The File For The Mortgage
If you have already chosen the home and verified its situation, you must prepare the mortgage file to present it to the bank. Remember that you must choose very carefully the type of mortgage that best suits you and ask the bank what the requirements are.
Some of the general documents that must be presented, in addition to the DNI, are the payroll (if they are not domiciled in the bank), as well as the appraisal of the property that interests you.
Read The Mortgage Clauses
One of the most common problems with mortgages is that they have small print and clauses that it is best to read carefully. Many banks force buyers to purchase certain products such as home insurance, mortgage non-payment insurance or revolving cards; these are credit cards that automatically defer purchases and withdrawals.
