So, you’re thinking about buying your first home? Well, we’ve compiled a few things we think are very important for you to know before jumping in! Here are five things to know before buying a house that I have learned from personal experience.
Important Things To Know Before Buying A House
Let’s be honest, with the current market and artificially suppressed interest rates just about anyone can buy a house, the real question is whether you should. Simply going down to the bank, taking out a loan, and hoping for the best is a recipe for disaster. Here is what you need to know to make sure that you’re ready to take on the joys and burdens of home-ownership. These tips will help you be prepared if this is your first time buying a home.
Figure Out The Costs
First, determine exactly how much your monthly mortgage payment will be. It may seem obvious, but not every home buyer goes in with their eyes open, as the recent mortgage crisis clearly demonstrated. There are several free mortgage calculators available on the internet, which will at least give you a place to start. This is one of the most important tips when it comes to your first time buying a home. I remember when my husband and I went and got pre-approved for a mortgage and we thought ok this is how much we can afford. However, when we looked at the monthly payment on that amount we weren’t really prepared for that and had to lower or price range in response.
Owning a home is expensive, and I don’t mean just the mortgage payment. The minute you open the door you get to start thinking about home improvement, maintenance, and minor disaster management. How much does it cost to pump water out of a flooded crawlspace? How well insulated is the house, and how much will heat or air conditioning cost? Do you have to irrigate your yard?How much does water cost in your area? What does it cost to put up a fence? These are all questions you need to ask yourself.
There is no such thing as a “turn key”.
There will always be things to buy or fix when purchasing a new home. No, you might not have to do a complete renovation job but just bare that in mind when you are looking at houses. Make sure to do your due diligence and look for the odds and end things you might have to purchase right away or fix. For example, appliances, shower rods, appliances, outside trash bins, etc. Not everything you see stays with the house – so make sure to ask!
The closing date can and will more than likely change.
Probably one of the most frustrating things in the process of buying a house is when the closing date is changed, especially if your lease has already ended, or if you have already sold your house. So, when purchasing your home, make sure to give yourself some wiggle room. There is no worse feeling than feeling displaced or scrambling to find a place to crash for a few weeks before your home closes.
You will need fluid cash.
This is one of the most important things to know before buying house. Even if you are able to negotiate the seller paying the closing costs and you already have your down payment – there will still be costs throughout the process. For example, things like home inspections, radon tests, appraisals, and termite inspections all come with a price tag. Make sure you have the fluid cash before jumping in!
Your bank account is your best friend and your worst enemy.
The loan underwriter will go through your finances with a fine tooth comb once you’ve decided on your home. Seriously, if you deposit money that you found lying around your house more than likely the underwriter will ask for an explanation of where the funds came from and to show evidence of how you got it. To be honest, explaining that I sold a few pieces of furniture on craiglist and deposited it into my account was probably one of the hardest things to prove to my underwriter. So, word of advice, when you start looking at houses (not when you put an offer in) keep track of all of your cash deposits, this will just help you later on.
Conclusion
Looking at homes, putting offers on homes, offers being rejected, counter offers, all of these things have an emotional toll. But try to keep the decision of buying a house the most methodical, logical and rational choice you make. It will be tough – so try to take a step back and think “what is the best financial decision for me when buying a house?”
The most important thing is to use every resource available to you to make an informed and cautious decision. Buying a house is a big step and you want to be prepared for your first time buying a home. It is a great investment once you are ready!
I hope these tips on buying a house have given you some insight into things you should know before buying a house! What are some things you think buyers should know before buying a house? Are you ready to buy your first home? What was your experience like? Let us know in the comments below!
Related Posts:
Liz Mays says
It’ so true about money. You can’t really do anything once you apply for the loan because it seems to freak them out. Making big deposits or withdrawals have to wait.
Jeanette says
It is most definitely a learning experience buying a house! We just bought one about three months ago and every single thing that you wrote in here is absolutely true.
Wendy @ ABCs and Garden Peas says
There’s so much to consider when buying a house. Your post hit some of the main points. The ever-changing closing date can be so frustrating. Of course it’s all worth the headache in the end when the house is finally your own!
CiaoFlorentina says
These are really great tips. Gotta save this list for the future !
Vicky Durrant says
My husband and I are going to purchase a home over the summer, so I’m happy that I found your post! I really liked your tips, especially what you mentioned about being rational when we choose which house to buy. I tend to be very emotional, but I’ll do everything that I can to look at the home from a rational standpoint, like you suggest. I’m sure that doing this will make the home buying process much less stressful! Thank you for the advice!
Bill says
Great tips. In South Florida SavingsRE.com can help buyers and give cash rebates!
Katie Anderson says
I really like what you talk about when discussing making rational decision as opposed to emotional decisions. I think something that is really important is lay out all the things you want or can do with your realtor beforehand. They can help you make sure that you are getting what you truly want, and wont make a decision based purely off emotion.
Faylinn says
My husband and I really want to buy a new house, but I don’t think that either of us knew that we would need to have fluid cash. For some reason, I thought that we would only be paying the real estate agent and that they would be taking care of the inspections, tests, and whatnot. Is there a way for us to just pay our agent once and have him or her take care of the rest?
Nathan Johnson says
Thanks for these house buying tips! My wife and I have recently began our search for a house. It is good to know that we have to have plenty of available cash to cover expenses that come up throughout the process. Also, I didn’t realize that a loan provider is concerned about where your cash deposits come from. Do you know why they care about that? Thanks for the info!
John Carston says
You made a good point with looking for odds and ends to fix when buying a new home. I like that you included the rational vs. emotional side of the buying process: to take a step back from the emotional aspect to make a the best buying decision. Thanks for the helpful home buying tips.
Kendall Everett says
I did not know that the closing date sometimes changed. Like you said, it’s good to be prepared and give extra time than be stuck searching for a place to stay. Would waiting to sell your old home after you purchase a new home be beneficial?
Brooke McAvoy says
I appreciate your tip about being more rational than emotional. This is definitely important to keep in mind through the craziness of finding a new home. However, I do think it is important not completely get rid of the emotional aspect. After all, a home is emotional, and you want where you live to make you happy. Thank you for all of the helpful and applicable information!
Justin Knox says
Thank you for the tips. I am trying to buy my first house soon. I had not thought about the closing date changing, as you mentioned. What are the reasons that the date will change?
Kendall Ryder says
Rational decisions are usually much better than emotional ones! I would hate to buy a home based on emotion, only to find out that it isn’t going to be the best choice. Really doing your research and thinking on the subject should hopefully help you to find the right home.
Forestwood Residences says
Purchasing a house is something that will specifically include each and every part of your money related life and is construct completely in light of your credit score. On the off chance that you are uncertain what yours is then right now is an ideal opportunity to discover. There could be things influencing your score that may keep you from getting a home loan and those should be cleared up quickly. At that point you will require a completely pre-approved mortgage so you can start the second step.
Gregory Willard says
My friend was thinking about buying a new home for his family, and didn’t want it to be too stressful. I had no idea that the closing date can and will most likely be changed. It would be pretty frustrating if you already sold your house and you can’t get into your new one yet.
Lillian Schaeffer says
These are some great tips, and I appreciate your advice to take a step back and make sure you’re making a rational decision when choosing a house. My husband and I are going to be moving out of our apartment and into our first house, so this is an extremely exciting time of our lives. I want to make sure that we make a good decision, so I’ll try to stick to the rational side of things and not let my emotions get the better of me. Thanks for the great post!
judy wilson says
When I decided that I wanted to buy my first house, I wasn’t aware of how the closing date can change before reading this post. I’m glad that you told me this since I thought that it was unlikely that it would change. I haven’t thought about a backup plan in case I need a place to stay, so I’ll do that if it will be a few more days or weeks until I can move into my new home.
Kate Hansen says
I’m excited to purchase my first house because it will feel like I’m a real adult! I like your tip about making sure you are making rational decisions versus emotional decisions. Choosing a house when you are thinking rationally will make sure you are putting yourself in a good situation and setting yourself up for success.
Parveen Kumar says
Hi, I read your blog that is really great and useful for me because I am finding a house as well as some useful information before buying a house.
Danni Black says
I am so glad that I came across this article. My husband and I have been wanting to buy a home for a while now and we are finally looking at houses! I think that these tips will be really helpful in getting us the home of our dreams. Thank you so much for the advice and information!