Buying your first house is an exciting experience that many Americans consider a rite of passage. That said, a property purchase is a huge investment, so you don’t want to make any errors. There are a number of common home-buying mistakes to avoid, such as getting only a single mortgage rate quote and miscalculating the repair and renovation costs that can come with a house. Don’t let yourself get caught by these traps. Check out these guidelines for buying a house and spare yourself the stress.
Find the Perfect Home to Suit Your Needs
Your house should be a place where you feel comfortable. As such, it’s incredibly important to choose your property carefully. First, consider the neighborhood you want to move to. If you have kids, for example, you may want to search by school districts. Other factors to consider include distance to amenities such as supermarkets and gas stations. If you have children, you’ll probably want to be in a family-friendly area.
Once you have the neighborhood narrowed down, consider your needs in terms of structural characteristics, such as the age of the home, how many stories it has, and how many bedrooms you need. You can then get an idea of how much your home will cost you by browsing online; for example, according to Redfin, homes in Farmingville currently sell for around $378,000 on average over the past month or so. The tool lets you search by neighborhoods and provides details regarding house size, number of bedrooms, and number of bathrooms.
Secure Financing Before You Make an Offer
Once you’ve scoped out property prices, you will have an estimate of housing prices, which can help you determine what you’ll need in terms of financing. In general, the standard rule for a down payment is 20 percent of the full purchase price. It is possible to pay a smaller lump sum up front but likely not in your interests. A larger down payment means no private mortgage insurance premiums, smaller monthly mortgage payments, and less interest overall. This will save you more money in the long run.
As you scope out financing offers, look beyond traditional mortgage lenders. For example, the government has a unique first-time homebuyer loan program. Features include a lower credit score requirement, no income limits, and gifts that can be put towards your down payment. There is even an energy-efficient mortgage loan that lets you integrate the expense of energy-efficient upgrades into your Federal Housing Authority loan.
Consider Building a House of Your Own
It may be that you scour the real estate market only to discover that your dream home isn’t out there. If this is the case, you might be better off building your house. Still, you’ll have to figure out financing beforehand. The cost of building a house averages around $428,000. Of course, the exact price depends on various factors, such as size, design features, and shape. Keep in mind that getting a loan to build a home is slightly more complicated. Usually, the lender pays in stages as the project is completed.
Once you have the money in place, you’ll have to hire a skilled team of professionals to actually transform your vision into reality. A real estate agent can help you find a tract of land you’re allowed to build on. Once that’s completed, hire an architect to sketch the blueprints for your property. Most people hire a general contractor for the actual building process. They coordinate with the architect and also organize the many professionals needed to build a house, such as electricians, bricklayers, and plumbers.
Hire a Home Inspector
Whether you buy or build a home, you’ll need to get it inspected to ensure that it’s safe to live in and to avoid any “surprise” costs that may occur after you get settled in. A home inspection will involve looking at every physical component of your home, addressing existing problems, and checking for potential issues. Be sure to hire a home inspection company, like The Inspection Boys, that’s thorough and highly skilled and trained.
While it does require some time and money, owning a house of your own will be well worth it once all is said and done. Just follow the above steps and be patient. Soon enough, you’ll have achieved the American dream of ownership.
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