What Do I Need to Know Before Buying a Home?
Before you buy your home, you’ll need to think about your finances and the property itself.
Usually you will need a minimum of 5% for your down payment and 3% of your home’s purchase price to cover closing costs.
You should get pre-approved for a mortgage so you don’t have to wait to make an offer and you will have an idea of the amount of your monthly payments.
Other options to consider:
- Check with your bank, if you are getting your mortgage at your bank you can ask for a discount or a waiver.
- Check for buying programs incentives by the government, specifically if you are a first-time-buyer
- Open a First Home Savings (FHSA) tax-free, you can invest up to $8,000 a year (with a lifetime maximum limit of $40,000)
Cost-related factors to consider:
Purchase price: Ensure the home's price aligns with your budget and financial goals.
Property taxes: Research the property tax rates in the area and factor them into your budget.
Homeowners insurance: Obtain quotes for insurance to understand the ongoing cost of insuring the property. Western Financial Group Licensed Insurance Experts can provide you with quotes from top insures to fit your needs, give us a call now.
Maintenance and repairs: Budget for regular maintenance and potential repairs, especially for older homes.
Utility costs: Consider the home's energy efficiency and potential utility expenses.
Closing costs: Budget for closing costs, which typically include loan origination fees, appraisal fees, and title insurance.
Renovation and improvement costs: If you plan to renovate or make improvements, factor in these costs.
Resale value: Consider the potential resale value of the home, especially if you plan to sell in the future.
Financing costs: Understand the terms of your mortgage, including interest rates, points, and other fees.
Property factors to consider:
Location: Choose a neighborhood that fits your lifestyle, with good schools, amenities, and proximity to work and essential services.
Budget: Determine what you can afford, including not just the purchase price but also ongoing expenses like taxes, insurance, and maintenance.
Size and layout: Consider your current and future needs, including the number of bedrooms and bathrooms, layout, and overall square footage.
Condition: Inspect the home for any issues that may need repairs or renovations, including the roof, foundation, plumbing, and electrical systems.
Home features: Consider features that are important to you, such as a yard, garage, or specific amenities like a fireplace or updated kitchen.
Safety and security: Check the neighborhood's crime rate and consider factors like street lighting and access to emergency services.
Future development: Research any planned developments or changes in the area that could affect property values or quality of life.
Home inspection: Always get a professional home inspection to uncover any hidden issues before finalizing the purchase.
Insurance History: Insurance companies will likely have a record of previous claims or past problems.
By carefully considering these factors, you can make an informed decision when buying a home that meets your needs and fits your budget.
