Home Buying Habits
Buying your first house is probably the most significant purchase you’ll ever make. That said, it’s also a decision should not take lightly. When you’re planning to buy a house, there are things you should know beforehand or else you might end up regretting later. So here are a few valuable you should know that will help you get ready in purchasing your first home:
The first thing you should know is an obvious one: figuring what you can afford. A recent post from Bankrate explains why determining what you can afford is a top priority:
Figure out what you can afford
There are various ways to determine how much house you can afford. If you’re using an FHA loan, your monthly payment can’t exceed 31 percent of your monthly income. The FHA will let you go higher under some circumstances.
For conventional loans, home expenses should not exceed 28 percent of your gross monthly income, says Susan Tiffany, retired director of personal finance publications for adults for the Credit Union National Association, or CUNA.
Add to that other housing expenses, such as taxes, insurance and utilities. Then, bank the difference between that total and what you’re paying now. Via bankrate.com
Money is one of the things that you should be completely honest about when buying a home. Going over your budget may be possible, but it will only overstretch you in the future.
The next thing you need to know is to understand the extra costs associated with buying a property:
Understand the costs associated with buying property
A deposit for a house is not the only cost to consider, Mokgatle explained.
Applicable upfront costs include the bank initiation fee. This is a flat rate across banks which is R6 000 and is payable before the bond is registered.
The second applicable fee is the attorneys’ registration fee. Multiple attorneys can be involved and separate fees are charged for the separate skills required, Mokgatle explained.
For example, a fee is paid to the attorney to register the bond in favour of the bank through which you are getting your bond. Another set of attorneys is responsible for the ownership transfer.
There is also a transfer duty payable to the South African Revenue Service, she said. h/t fin24.com
This is a primary reason why it is much better to buy a house below your budget. There are definitely extra costs after buying your home such as renovations or repairs which can cost more money than expected.
Lastly, is to work with an experienced buyer’s agent. A recent post from Fatherly discusses the advantage of getting a reputable agent to help you:
Going it alone can be costly
If you like the idea of searching for a home by yourself, well, you’re not alone. It’s easy to be confident in your own abilities at the start of the journey. Once you get down to the nitty-gritty of contract negotiation, however, you may end up with a sudden dose of humility.
Working with a reputable buyer’s agent gives you access to their expertise, not to mention a network of bankers, attorneys and other professionals in their referral network. And because they’re, in effect, paid by the seller, there’s really no extra cost to use their services. “It’s truly a win-win,” says Vladi. read more at fatherly.com
If you’re a first-time home buyer, it is safe to say that you don’t have much experience. For that reason, you would benefit from a buyer’s agent that has the expertise in the local Calgary market.
You may assume hiring an agent is expensive, but it doesn’t have to be. Seller Direct provides you with a commission rebate when you buy a home with us, saving you hundreds or even thousands.