Home Buyer’s Guide

Who doesn’t aspire to buy their own home? Indeed, for many people, it’s the biggest purchase of their lives.

The US government actively supports homeownership. If you are a first-time buyer, it may be possible to participate in state programs and obtain tax breaks if you decide to buy a property. In some cases, the government will also help with the 10-20% deposit you need to move forward with a home purchase.

So, whether you are a first-time buyer or experienced property owner, here’s a home buyer's guide of some of the key steps to follow and things to consider to make your purchase a success.

Review Your Financial Status

That is, consider:

  • Your job: is it secure? Are you likely to get a promotion or a significant salary increase soon? Will you be buying a home and repaying the mortgage by yourself or with a partner?
  • Savings: how much savings do you have, and/or are you a good saver? Or a big spender? Don’t forget there are ongoing expenses after a home once you purchase it.
  • Your current debt, especially credit card debt or car loans: if you take on mortgage repayments, can you still afford to repay other loans you have?

What is the Amount of Mortgage you can Obtain?

The lender will determine the amount you can borrow based on your salary and savings. They will also consider your current debt and whether you will be repaying the mortgage by yourself or with someone else.

It is necessary to get “pre-approved” by a mortgage lender for a loan before you start looking at homes. However, mortgage calculators are available on the internet, so you can get some idea of how much you can borrow before you meet a mortgage provider.

Adding together the mortgage loan with your savings will give you an idea about the value of the home you can afford.

Home Buyer's Guide: What Mortgage Options Are Available?

It’s essential to study the various financing options you may have. Try to obtain offers from 2 or 3 mortgage providers. Then, for example, look at:

  • The rate of interest they suggest.
  • Will the interest rate be fixed throughout the mortgage or change as interest rates change.
  • Is the mortgage being offered for, say 5 years, 10 years or longer? This period is called the “term” of the mortgage.
  • Can you repay the mortgage before the term expires? If so, is there a pre-pay penalty?

You may need a professional mortgage adviser to help you understand more about the mortgage process. He/she can also give you advice on which type of mortgage best fits your needs.

How do you find a home, and who will help guide you through the purchase?

Once you have pre-approval for a mortgage, it’s time to start looking for a home. You can do this by checking online or newspaper adverts or driving around areas you like. But, probably, the best way is to contact a local real estate agent with a good reputation.

The agent will not only help you find a home but guide you through the buying process.

Make sure you have some idea which locations you prefer and which specific features you want in your home, ie 3 bedrooms, big living areas, outside deck, nice garden, etc.

Once you have found a home you like:

  1. Make an offer
  2. Agree to a price
  3. Have the home inspected
  4. Close the transaction
  5. Move in!

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