Buying your first home is one of the biggest decisions you can make. And as such, a first time home buyer loan could be in your consideration today. So here are the things you need to know before embarking on one of the greatest decisions in your life:
Know What You Want and What You Can Afford
Who’s not excited to live and make memories in a new home? You might already have certain standards and pictures of how you want your dream home to be but keep in mind that you wouldn’t want to pay for a house loan forever.
The basic deposit for a house loan would usually be around 20% of the property’s total price. Then there are also fees like lender’s mortgage insurance, stamp duty, mortgage registration, and land transfer fee. So, you might end up saving for the deposit only if you neglect to look up the other expenses mentioned earlier.
Check the Location
You might want to consider things near your house like transportation options, schools, hospitals, grocery stores, neighbourhood crime rates, etc. Also, be sure to at least check on the minimum requirement you would need for your home before applying for any loans.
As a first-timer, you must keep in mind that certain ideal locations can also affect the value of the property, thus affecting the value of your loan. Proposed developments around your home can also create an impact on the value of the property.
Be sure to have assets, a good credit score, or find the right lender. Banks and lenders will check for your assets, so be sure you are ready to provide them with information on how you would be able to pay for your loan. Hence, be prepared with your payslips and bank statements.
Check your credit score, too. Your credit score allows your lender to know your credibility. Nevertheless, a good score means faster processing of your home loan application, and first-timers usually have a good one.
Meanwhile, if you have issues with your assets, especially dealing with banks, find another lender. Many companies now can assist and help you with processing your loans. You’ll have to find the right one that can best support you later.
Explore Your Loan Options
There could be a first time home buyer loan, grant, or service for you. So, be curious and ask questions. Get testimonies from other homeowners and explore the best suitable option for you.
The first-time homebuyer grant, which has been available in the past years, was a program introduced by the government to financially assist first-time homebuyers that satisfy their eligibility criteria. So, you might consider applying for this grant to help you with the deposit cost
Be sure to get pre-approval of the loan from your lender to know how much you can borrow. Don’t forget that you can also negotiate with the property broker and plan strategies in accordance with the current market trend.
Remember that there are a lot of home loan options for first-timers, so educate yourself on the different loan types. Do not just look at the advantages of the loan plan, but look at its disadvantages as well. You wouldn’t want a loan that you could not afford and risk your house getting auctioned by the bank later on.