10 valuable lessons for first time home buyers

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10 VALUABLE LESSONS FOR FIRST-TIME HOME BUYERS

www.kapsystem.com ©2015, KAPSYSTEM ( Bulk SMS Service Provider Company) , Email [email protected]

1. Start Saving Right AwayThe earlier you start saving for that down payment, the easier it gets. We

didn't start worrying about it until it was too late, and we had to get a mortgage for more than 80% of our home's value. If we had been on the ball even two years earlier, we wouldn't have had to do that.

If you want to avoid paying private mortgage insurance, or PMI, in most cases you need to save up at least 20% of your future home's value to use as a down payment. That's easier said than done, but it becomes a much more realistic concept if you start saving right away.

2. Don't Rush ThingsBecause of the timing of my wife's pregnancy, we felt rushed into our home purchase. With a baby on the way, we knew our apartment would soon be exploding at the seams. Although I'm happy with our home purchase, I wish we hadn't rushed it so much.There are lots of factors to consider when buying a home, and you can often benefit by searching in different areas and neighbourhoods before you pull the trigger. I feel as though we settled in a way, and that's one mistake I still regret.


3. Build Your Emergency FundWhen you're a first-time home buyer, it's easy to be shocked by the many "extras" that appear in your monthly budget. Things that didn't exist before-like larger utility bills, home repairs, and lawn maintenance-start adding up and making a huge difference in your bottom line.If you want to be as prepared as possible, build your emergency fund for several months-or even years-before you commit to the home buying process. The money will be there when you need it that way, which will make the entire purchase a lot less stressful.

4. Price-Shop for a MortgageThe easiest way to get the best mortgage rates is to shop around as much as you can. When we were going through the home buying process, I was surprised at how much lower (and higher) mortgage rates from different firms could be.We ultimately chose the lowest rate out of three and went with our credit union. However, I really wish we would have taken the time to explore different loan options, as well as rates from at least a few more mortgage brokers. Saving just a half a percentage point on an average-priced home could lead to tens of thousands of dollars in savings over the years.


5. Pay Attention During the Home InspectionDuring the home inspection process, we thought we did everything right. We followed the home inspector through every room. We asked questions. We took notes. One thing we didn't do, however, was check things out for ourselves.Unfortunately, in our case, our failure to explore the entire property meant that we overlooked an extremely old and almost unusable hot water heater. We've since replaced it, but we might have been able to ask the seller for a credit had we known at the time. The bottom line-always inspect the home on your own and pay attention to the details.

6. Get a Second (or Third) OpinionWhen you've fallen in love with a house, it's easy to overlook things that may not be quite right. Unfortunately, those "love blinders" can cause expensive mistakes if you fail to notice something wrong with the property.That's why it's important to bring a family friend or relative along. Since they aren't buying the property themselves, they're more likely to see it for what it is. So get a second or third opinion from someone who isn't blinded by love goggles. Different eyes spot different things, and friendly eyes will tell you the problems they see.


7. Shop Around for Homeowners InsuranceIt can really pay off to shop around for the best homeowner's insurance policy you can find. And don't be afraid to move your other insurance policies and bundle them together-most insurers offer a generous discount if you package both your auto and homeowners policies, for instance.

8. Don't Go Furniture Shopping the Day After You Move InWhen you're a first-time home buyer, it's easy to forget that your new home will bring with it a whole new set of expenses you've never had to worry about before. So before you go on a furniture-shopping spree, take some time to figure out what your new budget might look like, and what you actually need for your new home.


9. Offer to Help Others Move for Years in AdvanceHow does this help you? Well, imagine over a three-year period that you help 10 different families move. When you move, you can call any of these people to help you move-and five families can unload a truck and unpack boxes at an astounding rate.Our big mistake wasn't the help we received, but how I managed it. Don't have everyone come and help you at once. Ask two friends to come one day and two friends to come another day instead of having them all come at once-you'll be far more productive that way.

10. Know What You Can Change, and What You Can'tWhen you buy your first home, the whole process feels daunting. The idea of spending thousands of dollars to replace or update old or unsafe systems or out-dated appliances is especially unsettling and can seem like an insurmountable obstacle.

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10 valuable lessons for first time home buyers

Real Estate

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