Are You Ready to Buy a Home? Steps to a Successful Home-buying Experience
Whether you are shopping for your first home or determining where to purchase retirement property, the process can be stressful. How will I afford what I want? How much money should I save before purchasing? How do I get a loan? Here are some tips from Forbes for successful home-buying.
How much can you afford?
Determine how much you can afford before you start looking for a home. To accurately calculate this number Tom Gilmour, Certified Financial Planner, suggests looking at home prices that are two to three times your annual income. In addition, check that your mortgage payments not exceed 28% of your gross income.
Gilmour also suggests having 20% of the home price for your down payment plus another 3% for closing costs to avoid having to buy private mortgage insurance.
Make sure you have enough money left over for home improvements, decorations or miscellaneous moving and maintenance costs. Avoid using your emergency fund to cover these costs.
Try before you buy.
For successful home-buying, give your finances a trial run. Start by totaling up all of the monthly costs associated with a home purchase, including your projected mortgage payment, tax and insurance estimates, HOA fees and home maintenance costs. Don’t worry if you don’t have concrete numbers—the point is to see if you can afford a ballpark amount.
Can you have it all?
Home-buying is give and take. Decide up-front what are must-haves versus nice-to-have home features. Must-have examples include number of bedrooms and bathrooms, proximity to work and access preferred school districts. Nice-to-haves include decor, well-manicured landscaping, a pool—or anything else you can easily fix or install yourself.
Vintage Oaks has a range of home options for you to chose from to make your home-buying journey a success!