If you’re shopping around for your forever home, you’re done with renting, and ready to move on, there is a lot to think about. Take a look at our guide to buying a new house and everything you need to handle before you move in.
Arrange a mortgage
Housing prices are rising and will continue to for the foreseeable future, so it’s best to have a plan when approaching lenders for a mortgage.
There are various guides and tools to help you online, like self-reporting credit score boosters, and things like an MRTA calculator. To not take advantage would be like leaving money on the table.
When shopping around for a new home, your potential lender will take an estimate of your maximum loan amount and offer you an idea of how much you can borrow, and you can use it to start shopping around for homes. However, there are ways to make sure you’ve got the maximum amount you can get.
You can land yourself a bigger loan with prove of more income, like dividends from investments. If you don’t have any investments you can look to rent gained from properties, alimony or child support, social security income, or money earned from a business or part-time job.
If you can pay off your credit card debt in one go, or an installment loan, you should. It will make a big difference in your debt-to-income ratio and is a quick and easy way of increasing how much of a loan you qualify for. But there are other ways, like reducing it with a balance transfer card or consolidating it into an installment loan.
If you pay at least a 20 percent down payment on your loan, you won’t have to pay the private mortgage insurance that would otherwise be folded into your monthly repayments. And paying more than 20 percent will lower the rate of your interest.
Check for damages
Remember that the point of doing a house tour, is yes, to see if you could see yourself living there, but to also weed out any red flags that could become a long-term problem. Sure, your inspection will likely surface a few problems, but wouldn’t it be better to see them upfront and not get your hopes up if you see a dealbreaker?
Keep a lookout for water stains on the ceiling and under the sinks in the kitchen and bathroom. Test all the faucets and showers for running, hot, water. Take a look at the basement, garage, and crawl space for a sump pump.
Head outside and take a look at the roof. Ask your realtor the age of the roof and look out for any missing or damaged shingles, rusted flashing, moss, or dirt. A damaged roof can create problems down the road, damaging not only the exterior but the interior of your home.
While you’re outside, look for literal cracks in the foundation. Visit the garage, basement, or any crawl spaces to look for cracks or water damage. Also, keep an eye out for any droppings that could indicate some bugs or pests in the house.
Check all the appliances to make sure they are working. Do the outlets have power? Take a phone charger and casually stick it in any socket you find. Turn on the stove, check the fridge and run the dishwasher. Try out the air conditioning, even if it’s freezing, and the same for the heating.
A lot of these things have simple fixes and probably won’t affect your decision but going in blind and missing them will make them big problems in the long run. It would be best to know what you’re getting yourself into in the future.
Explore the neighborhood
If you’re committing to buy a home, you will also be committing to the neighborhood. Make sure everything you need is within a reasonable distance.
Schools are obviously a big incentive for partners looking to settle down, but you should also look at if the property is close to work or has good public transport access so that it is easy to get to work.
Think about what you buy on a regular basis and how that is affected by your neighborhood. Will you have to drive for a weekly shop? Or do you need a 7-Eleven nearby for emergency midnight snacking excursion?
Take a look online for the crime stats in your area to get an idea of whether you feel safe in the area. On top of that, look up how far away you are from the emergency services, should the worst happen.
Listen to the streets, too. Is there a low noise level? Is it ongoing or just at peak times? Visit at different times of the day to see if the noise is still around.