Buying a home is a big step for many people, and it also takes a substantial amount of money. Some people will assume that they could never afford to purchase a home. Likewise, others will assume that their credit score is inadequate for banks to lend money.
Buying a home requires due diligence
From your down payment to figuring out how much you can afford to pay monthly, it takes a lot of due diligence and patience to be sure you can afford a home. The problem is many people tend to forget about some of the many costs that must be covered when buying and owning a home. This includes anything from appraisal fees, to paying for new furniture. If the buyer is unaware of simple costs like these, when purchasing a home they could end up spending much more over the course of owning the home, and put themselves in a unfavorable financial position. Read more about the affordability of the housing market here.
There are ever-increasing amounts of loan options for home buyers, especially low down-payment options. Depending on the location of the prospective property, you may find that the house is eligible for a USDA/RHS Rural Home Development Loan. For more loan options, check out bankrate.com for current mortgage rates.
Sound homebuying advice
By understanding the many taxes, costs and fees associated with buying a home you can be much more prepared when shopping around and insure that every penny you have doesn’t end up going right back into your home every month. It’s important to buy a home you can afford whether it’s a vacation home, first home, or the next home.
Dave Ramsey has a good step by step checklist for buying a house. Also, take a look at these many costs that tend to be forgotten by homebuyers here.