Decision to buy a house is considered the most important next step for a couple after they have married. This is going to be their own nest where they will raise a family, see themselves evolve and above all create an asset for themselves.
But the path that leads towards the ownership of a house is not easy. You need to overcome many obstacles on your way and may get bogged down by the difficulties you face and may end up postponing the decision.
Owning a house is an important decision, if you think you are ready for it then be mindful of all the problems that may emerge, plan carefully and tenaciously implement your plan.
First be excited about purchasing a house
To succeed in any project, it is important first to be extremely motivated and excited about the idea. Buying the first house is a beautiful dream for a couple. You must discuss this idea frequently with your significant other, dream together of living in a beautiful abode of your own. The kind of house you would be living in, raising kids, having pets, equipped with modern appliances, beautiful views from the balcony and a green backyard where you would spend weekends together, chatting, unwinding, and having fun.
Discuss and dream together so much that this idea is firmly planted in your subconscious mind, so that nothing should dissuade you.
Important questions to be asked and issues to be discussed with each other.
Do you both want to own this property?
Discuss this honestly and extensively with your partner whether they would want to be co-owners or be satisfied with letting any one of you be the sole owner of the house. This might happen when one of you might not be earning enough to contribute significantly towards down payment or monthly mortgages.
What are your debts?
If you are newly married, then you are too much in love with in each other to discuss personal finance. But if you are purchasing the house and that too jointly then you must know how much debt each one has and what are the credit scores.
Mortgage lenders before approving your loan, check your credibility and financial capability to return the loan back in a timely manner. This they do by calculating your debt-to-income ratio. This ratio is your total monthly payments on debt divided by your total monthly income. A higher debt to income ratio could disqualify from getting the loan or even if you qualify, you must pay a higher interest rate.
How much you can afford to spend on the purchase of the house?
When you think of your dream house, you think big. But you must discuss realistically and honestly with each other, do you have enough financial muscle to afford that beautiful Italian Villa? Look at your budget and see the best you can afford in that price range. Ideally you would want to pay 20% of the purchase price as the down payment to get the best interest rates and payment terms but if you can not afford that you can always apply for FHA loans, where for the first-time buyers like you, you get very favourable terms. You must pay only 3.5% of the purchase price as the down payment.
What is your budget for renovation?
After paying for the down payment, the next important expenditure are the renovations and upgrades needed in the house. Most of the new homeowners, in their excitement, tend to forget about this very crucial part of the home ownership. When they find themselves staring at broken windows, roof, faulty plumbing, and electrical systems, they get the shock of their life because repair costs may amount to thousands of dollars. Ask each other, how much renovations you can afford and what should be the budget.
After discussing these important issues thread bare and planning for all the contingencies, you can move ahead with the purchasing process, confident in your planning and preparation. If you need more assistance with questions related to buying a home, you can call American Made Home Solutions at (360) 386-7493.
