There are certain things one needs to do before buying a home as they are a huge investment. The simple steps of buying a house include; improving one’s credit score, figuring out what you can afford, saving for down payment or closing costs, building a healthy savings account, getting pre-approved for a mortgage and finally buying the house you like. In improving your credit score one is able to get the best deals in terms of paying down payment and also have the best rates on the market. In order to purchase a home the step on figuring out what one can afford is by using a bank rate calculator. In addition one also adds housing expenses such as insurance, utilities and taxes.
Saving for down payment or closing costs involves an individual needs to save between three percent and twenty percent of the house price for a down payment. An individual’s credit history and loan terms determines how much they need to come up with. Down payment assistance, first time home buyers and home buyers assistance are some of the assistance one can get if coming up with the individual payment is hard. First time buyers who are particular buyers or based on location is what down payment assistance offers. A portion of the closing cost can be paid by sellers in a buyer’s market as they can negotiate this. In order to assure the lender that you are not living pay check to pay check then building a healthy saving account is required.
Individuals are given more latitude on criteria if the backers and the lenders see that one has a cash cushion in which the money also pays for maintenance and repair of the home. Some repairs like new roof fixes or water heater fixes are huge repairs which come up suddenly and drain your budget while on the other hand most repairs are sporadic. In order to build a healthy savings one needs to assume that they’ll spend 2.5 to 3 percent of the home’s value each year on upkeep and repairs.
The fifth simple step after building a health savings tips is getting pre-approved for a mortgage in which one needs to get their finances in order. By having a mortgage pre-approval an individual is able to know how much they can afford before they walk through the first house. In determining how much one can afford to buy a bank rate calculator is used. Buying the house you like is the last step in which short term home ownership is quite expensive as its dependent by how much one puts down and what it costs to sell the old hose and move.