What to Be Wary of When Buying a First House
Buying your first home is an exciting time. It may represent making a big investment in your future, building up an asset, and providing your family with a safe center of family life. However, there are some pitfalls to avoid when you are considering which house will become your very first home.
What are some things to concern yourself with? You should consider the condition of the house, the real cost of owning a house, and your own financial situation now and in the future.
The Actual Cost Of Home Ownership
You will find that the true cost of home ownership depends upon a lot more than just the mortgage payment. Very likely, you will need to also pay property taxes and homeowners insurance bills. Be sure to account for the cost of these when you decide if you can afford to purchase a house.
Other expensive things that are not as easy to predict are the cost of maintenance and repairs. If you buy a new home, you may get a warranty that covers some things for awhile. If you buy an older home, you should get it inspected before you buy it to make sure that it is in the kind of condition that the seller says that it is.
In any case, maintenance, lawn care, home insurance, and taxes can all add a few hundred dollars every month, and this can add up to several thousand dollars a year.
Finding The Right Mortgage
Most people do have to borrow money to afford their first home. Of course, being able to pay cash for a house is great, but it can take a long time to save this much money. In any case, it is a lot better if you can put up a down payment, so you will start off your home ownership adventure with some equity in your house.
Make sure you understand the terms of the mortgage very well. For example, some new home buyers got loans that seemed like they had very low interest rates, but those rates could rise with rising interest rates, and those home owners got in trouble because they could not afford the higher payments.
Make sure you find out if the interest rate will always stay the same for the life of the loan. Remember that you will still have to cope with insurance and taxes, and those things are not so easy to control as the mortgage rate that you get.
Should You Buy A New Home Now?
Maybe the biggest single factor that you need to consider is your own ability to keep your house. People should buy a house when they are pretty sure that they have money in the bank and also have some backup savings just in case of an emergency. It is not always possible to totally predict the future. However, your own financial stability will be the one factor that will help you thrive in the future.