Important Factors to Consider When Purchasing a Home
A home represents the largest investment most people will make in their lifetimes. As such, buying a house is not something that should be approached lightly. No matter how excited you are to make the jump from renter to homeowner, there are a number of things that must be taken into account before you start signing paperwork. To ensure that you make an informed, well-reasoned decision when the time comes to purchase your first home, take care to consider the following factors.
Finding the Right Mortgage Lender
Unless you’ve come into a sudden windfall of cash, you’ll more than likely be paying off your home through a mortgage. Unfortunately, so many first-time buyers are so eager to secure their new homes that they’ll sign on with the first mortgage lender they speak with. As any seasoned homebuyer can attest, this is a classic rookie mistake. Provided your credit is good, you should have no problem finding a highly regarded lender who’s willing to offer your desired rates — you’ll just have to do some legwork.
When shopping around for the right lender, you won’t necessarily have to spend a lot of time with each one. Just provide the lender with your paperwork and allow him or her to run a check on your credit. Once the credit check is complete, you’ll be presented with a list of options. Should none of these options seem appealing, simply seek out another lender. Additionally, after finding the lender you want to work with, make sure to ask them about home purchase warranty options.
Getting Pre-approved for a Mortgage
Unless you’re pre-approved for a mortgage, don’t bother reaching out to real estate agents, as many of them will decline to work with you. There are a number of reasons for which mortgage applications are rejected, but more often than not, bad credit is to blame. Should this prove to be the case with you, you’ll need to take active measures to pay down your outstanding debt before reapplying.
Yes, this will mean postponing your home purchase and possibly losing your chance at a house you’ve had your eye on, but it’s the most effective way to get your credit in order. If you’re already drowning in debt, buying a home will only compound the problem, not make it better. Even if improving your credit is a years-long undertaking, it will ultimately prove well worth your while.
Compromises You’re Willing to Make
Everyone has a vivid picture of what their first home will look like and what amenities it will feature. While there’s nothing wrong with dreaming big, it’s practically a given that the exact home you’re looking for either doesn’t exist or is well outside of your price range. However, this isn’t to say that you should give up on everything you envision for your first home. Before kicking off the house hunt, sit down and make a list of features you’re not willing to compromise on and features you can live without. This will make it easier to maintain realistic expectations when searching for the right home and help put which features are truly important into perspective.
Before committing to purchase a home, it’s imperative that you have the property thoroughly inspected. An experienced home inspector will be able to locate a wide range of structural, electrical and cosmetic issues in a timely manner and explain exactly how serious each issue is. It’s worth noting that small imperfections are found during virtually every home inspection, but if your inspector claims that the issues he or she has located are serious, this should give you pause. If you’re about to spend a small fortune on a house, costly repair bills are the absolute last thing you want to be faced with.
Few things in life are more rewarding than being handed the keys to your first home. Not only is buying your first house an important adult milestone, it’s also a culmination of years of effort and hard work. However, regardless of how excited the prospect of home ownership makes you, this isn’t something you should jump into unprepared. To increase your odds of finding the right home at the right time, remember to carefully mull over the previously discussed factors when the time comes to buy.