Last Updated on Apr 17, 2020 by James W
Buying a home is an exciting time, but you cannot let the excitement cloud your judgement. The fact is, you have a lot of things to think about and consider before buying a home. For most people it is the most expensive purchase they will ever make, as the average home in American is over $200,000.
As a result, you should put a lot of thought into the purchase. In an effort to help you out, this article will look at 4 considerations you should make before you ever agree to purchase a home.
Think of the Future
When it comes to purchasing a home, you don’t want to simply buy a home for the life you have today. Buying a home is a huge purchase and can potentially take decades to pay off, so you need to consider long term goals and plans before buying a home. You should never buy a home if you are planning to move in the next half-decade of so.
On top of that, you also need to think if your needs will change. Are you going to be having more kids? Accruing a lot more items? If so, you need a home you can grow into and not be forced to move multiple times due to space constraints.
Ensure you Get the Right Mortgage For You
Unless you have hundreds of thousands of dollars just sitting around, you will likely require a mortgage to purchase a home. In general, there are two different categories of mortgages that you can get in the USA. These are a government loan (which are backed and insured by the government) and conventional loan (which are not insured or backed). Each have their own unique benefits such as a lower (or no) down payment for most government home loans, and lower mortgage insurance premiums for conventional loans.
In addition to these categories of mortgages, each home loan will have some other differentiating factors such as term length, interest rate and more. Do some research and reach out to some experts to see which mortgage is the best for your situation.
Don’t Buy More House Than You Can Afford
As much as all of us would love to live in giant and impressive mansions, that simply isn’t viable for most of us. Because of this, we need to be sure to set a budget for ourselves and stick to it. The overall purchase price is important, but not as important as the monthly payments, as that is what you will be paying every month.
You need to identify how much room you have in your budget every month, and not go beyond that number, no matter how enticing the more expensive homes can be. In addition to the purchase price and monthly payment, there are other costs you need to plan and budget for too, such as maintenance, utilities, taxes and more.
Location, Location, Location
Of course, you want to like the house you buy, but sometimes, you need to look past the cosmetics of the color of the homes you are looking at. All of that can be changed or updated, but one thing that can’t be changed is the location of your home.
Location is important and you want to make sure you are decently close to places you frequent like the grocery store or gym, good schools for your children, parks and more. You also want to make sure the neighborhood is safe, of course. A wonderful house in an awful location or neighborhood isn’t always a better place than an average house in a great location.