#10: Keep Your Money Where It Is
It’s not wise to make any huge purchases or move your money around three to six months before buying a new home. You don’t want to take any big chances with your credit profile. Lenders need to see that you’re reliable and they want a complete paper trail so that they can get you the best loan possible. If you open new credit cards, amass too much debt or buy a lot of big-ticket items, you’re going to have a hard time getting a loan.
#9 Consider Renting
Buying a house isn’t always the best option. If you’re only planning on staying in a home for a couple of years, renting may be a better option for you.
You’ll also need to consider your personal finances. You may be able to afford your monthly mortgage payments, but can you afford unexpected repairs such as a flooded living room or damaged roof?
#8 Get Pre-Approved for Your Home Loan
There’s a big difference between a buyer being pre-qualified and a buyer who has a pre-approved mortgage. Anybody can get pre-qualified for a loan. Getting pre-approved means a lender has looked at all of your financial information and they’ve let you know how much you can afford and how much they will lend you. Being pre-approved will save you a lot of time and energy so you are not running around looking at houses you can’t afford. It also gives you the opportunity to shop around for the best deal and the best interest rates. Do your research: Learn about processing fees or points and make sure there aren’t any hidden costs in the loan.
#7 Don’t Max Out Your Budget
Just because you’ve been approved for a Kshs 13,000,000 mortgage doesn’t mean you should buy a Kshs 13,000,000 home. You’ll need to consider expenses for closing costs, taxes, insurance, repairs and monthly bills.
#6: Avoid a Border Dispute
It’s absolutely essential to get a survey done on your property so you know exactly what you’re buying. Knowing precisely where your property lines are may save you from a potential dispute with your neighbors.
#5: You’re Buying a House – Not Dating It
Buying a house based on emotions is just going to break your heart. If you fall in love with something, you might end up making some pretty bad financial decisions. There’s a big difference between your emotions and your instincts. Going with your instincts means that you recognize that you’re getting a great house for a good value. Going with your emotions is being obsessed with the paint color or the backyard. It’s an investment, so stay calm and be wise.
#4 Know What You Can and Can’t Live With
If this is your first home, consider what you can live with and what you can’t. Perhaps the kitchen isn’t ideal, but you know a few appliance upgrades will do the trick.
You wanted two full bathrooms, but can you live with one and a half? Know your must-haves.
#3: Give Your House a Physical
Would you buy a car without checking under the hood? Of course you wouldn’t. Hire a home inspector and if you have none in your market, at least get a professional realtor or engineer with inspection experience. It may cost you but it could end up saving you thousands. A home inspector’s sole responsibility is to provide you with information so that you can make a decision as to whether or not to buy. It’s really the only way to get an unbiased third-party opinion. If the inspector does find any issues with the home, you can use it as a bargaining tool for lowering the price of the home. It’s better to spend the money up front on an inspector than to find out later you have to spend a fortune.
#2 Don’t Judge a Book by Its Cover
Let’s face it, some homes show horribly. Some have old floors, some have peeling paint and some just downright stink. But just because a house looks bad, its current condition doesn’t mean there isn’t value there.
While you’re viewing a property, peek under the cabinets and other historical details.
If you’re lucky enough to have a friend in construction, have them take a look at the house’s foundation to determine if it will still be standing upright in another 100 years.
Learning if a house has good bones will help you look past the cover image on an otherwise dingy dust jacket.
#1: Use an Agent
If you’re serious about buying a home, hire a real estate agent. There’s no reason not to. This person is a professional who will not only schedule and accompany you on showings, but guide you through on the entire buying process.