Are you tired of living in your parent’s basement? Perhaps the current neighbors sound like a herd of elephants are crashing through your ceiling? Whatever your reason, buying a new home can be a bit overwhelming. Below you will find some questions you will want to consider before making the leap into homeownership for the first time.
Can you afford to buy a house right now?
Purchasing a home, especially for the first time requires a great deal of planning. Without proper preparations you are willingly exposing yourself to unnecessary risks. When buying a home you need to make sure that you are fully capable of affording all the aspects that come with it. A good rule of thumb is to spend less than thirty percent of your monthly income on housing expenses.
You will want to remember to calculate the private mortgage insurance (PMI) into this figure. PMI is charged when your down payment is less than twenty percent. Certain mortgage options, such as FHA financing allow you to purchase a home with only three and half percent down. In this case PMI is necessary. PMI is the insurance that the mortgage company takes on your mortgage to cover the risk associated with small down payments. To avoid paying the extra expense of PMI you will want to have a down payment of twenty percent or more.
Do you have time to shop for a house?
Buying a home takes time and patience. You will not want to rush through the house-hunting process. Take plenty of time to define what you want verse what you need in a home. Work with a real estate agent that is familiar with the location you are hoping to buy. Using a professional realtor can certainly help with the time strain that comes with looking for a new home.
Experienced agents know the ins and outs of the business. They have connections throughout the industry and a real understanding about the market. More often than not, experience allows agents to show you only homes within your specifications, thus not wasting your time one options that are not feasible.
In our next installment, we will look into more questions you need to ask yourself before buying your first home. There are many aspects that are overlooked especially by first time home buyers. Asking yourself these few questions can save you a lot of time, money and anguish. Our next installment on buying your first home we will cover the future, mortgage options, debt and home inspections.
Lady of the Lakes Real Estate is Livingston County's premiere realtor; out of Pinckney, Michigan helping buyers buy and sellers sell homes that provide a recreational lifestyle including golf courses, lakes and the Huron river chain of lakes, throughout Brighton, Howell, Pinckney and the surrounding area. Find out more at http://www.ladyofthelakes.com.