5 Steps to Securing Your Dream Home
You’ve walked into the kitchen of your dreams. You’re imagining how perfect your stemware and china would look in the built-in shelving that lines the wall of the dining room. You’ve found the house.
Even though it seems your search is over, the work is only beginning. Here’s your guide to getting the house of your dreams while staying firmly planted in the reality of today.
1. Prioritize Your Needs
Young children? Be sure to research the schools in the area and take note of parks and museums. Need public transportation? How far is the closest bus stop or is it a bike-friendly community? Make a list, then research, research, research.
2. Know Your Budget
Your housing budget should encompass your mortgage payment as well as homeowners insurance and property taxes. Most financial advisors suggest that the total mortgage payment should not be more than 35% of your pretax total household income. While you’re calculating, take the opportunity to get preapproved for a home loan.
3. Understand Negotiating
When you make an offer, factor in how long the home has been on the market, how hot the market is in the area, and the comparable rates of the other homes for sale in the area. Be sure to list contingencies with the offer; you want to make sure the home passes inspection before you sign on the dotted line.
4. Pick Your Mortgage
Yes, there is more than one type of mortgage loan. The most common is the fixed-interest mortgage loan, usually for 15, 20, or 30 years. An 80/20 loan is actually a pair of loans, one for 80% of the home’s price, the other 20% for the rest of the price including down payment. For first-time homebuyers, there are even federal programs to help. Federal Housing Administration loans offer first-time buyers low down payment options, low closing costs, and help with qualifying credit.
5. Know What You’re Signing
The stack of paperwork that comes with buying a house can be overwhelming, especially for a first-timer. If you have questions, ask your real estate agent or consider hiring a lawyer to represent you.
© 2015 Texas Farm Bureau Insurance
