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Buying a home for the first time is a huge milestone in the journey of becoming an adult. It not only represents the signs of financial decisions and independence but also the goal that they might have been working on for years. If you’ve made the decision to buy a home, there are some vital steps to consider before you get started.
Here are 4 steps you need to take before you purchase your first home.
Consider Where You Are – Financially
The first step to knowing if you are ready to buy your first home starts at where you are, financially. This means knowing how much you earn, how much you save, and how much you spend on bills every month.
Before you start your search, you will also want to check your credit score and determine how it will affect the interest rates on your next mortgage. Having a great credit sore will lead to lower monthly payments. However, a low credit score may require some time to improve it prior to getting a house loan.
Save For a Down Payment
You don’t always have to put around 6 months-worth of your actual income. You can decide just how much you need to put down as the smaller the down payment may be, the large the mortgage loan and interest you will have to pay.
Prepare for Unexpected Costs
The down payment isn’t the only expense you should expect to pay. In fact, buying a house comes with more expenses such as insurance, property taxes, closing costs, maintenance, and moving costs. Be sure to understand the property tax where you plan to live. It is always better to prepare for the worst rather than being surprised when the bills come around.
Apply for A Mortgage
Go through the pre-approval stage and determine just how much you can borrow from your lender. After you determine the basic requirements of your new home, you will need to make a list of deal breaks and must haves to help you narrow down the search.
Got any tips that you would like to share with us? Comment below and tell us what you think!