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What first time home buyers need to consider

If you are about to buy a house, congratulations! Often, people don’t make a big enough deal out of someone buying a house – and it’s probably one of the biggest purchases you will ever make. If you are over renting and ready to become a first-time homeowner, there are just a few things you need to consider before making the move.

How much do you know about the real estate market?

While many buyers perform some extensive research when buying a cellphone, TV, garden hose or any other random item, many fail to do proper research before buying a home, which is a HUGE purchase. Buyers often rely on advice from family and friends, who may not know much, or, even worse, trust the real estate agent to show them the ropes.  

Before you make your decision, take a lot of time to research the house, the area and the property market. Make sure you know how much other similar houses are going for in the area to avoid getting ripped off.

Do you plan on living in the area for a while?  

If you have any plans to relocate in the near future, buying a house may not be a wise choice for you. Make sure you plan on staying in the area for at least seven years as there are so many costs that come with securing a loan. Selling your house too soon may cause you to make a loss.

Do you have a good credit score?

This is extremely important when it comes to buying a house. Not only will this determine whether your home loan will be approved by a bank, but it will also affect the interest rate you have to pay off on your loan every month – for many years!

Can you afford to take out a loan?

Perhaps you should contact a home loan consultant before you decide to buy a home, especially if you’re working for yourself or your salary is mostly based on commission. You may struggle to get your loan approved; however, even if you do get your loan approved, you need to be able to afford the payments every month. Work out your budget with all the monthly loan repayment, levies and other costs that come with buying a house to see if you can afford to live comfortably while still paying back your bond.

Do you have money for a deposit?

While this isn’t a determining factor when it comes to taking out a home loan, putting down a deposit on a house is definitely a huge money saver in the long run! It also improves your chances of getting your home loan approved.  

Do you have other debts?

If you have other debts to pay off, consider staying away from taking out a home loan. It is an extremely expensive purchase that will put you in long term debt and the interest rates from most banks are extremely high. If you are struggling to pay off your debt, speak to us today.

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