The Dos And Don'ts Of Buying Your First Home

Posted on: 12 January 2015

Is it time for you to make your first real estate purchase? Too many times, people fail to recognize the deep responsibility of purchasing a home. It is certainly no walk in the park. Consider these dos and don'ts as you go through the process of buying your first home.

Don't buy a home if you plan to sell soon.

Buying a home is most beneficial to those who intend to stay put for at least a few years at a time. Of course, this also depends on whether you intend to rent the home out or live in it. Ensure that you can afford the cost of a home without trying to sell within the next few years, especially when prices are falling.

Do Build Credit First

It's no secret that most people do not pay for a house in cash. They typically need a mortgage or loan to pay for it. In order to get a mortgage you need to have clean credit. Make sure you do not have any bills looming in the background.

Don't Buy Beyond Your Means

Most people would love to own a stunning six-bedroom mansion or a beautiful penthouse with a million-dollar view. Unfortunately, most people cannot afford these things. The general rule is to buy a house that will cost 2.5 times your yearly pay. Of course, this also depends on your other income and debts.

Do Try To Put 20% Down

If you cannot put at least 20% of the home's price down, you may have a more difficult time qualifying for a loan. This could make it much more difficult to qualify for a low-interest mortgage.

Don't Forget About The Advantage Of A Good School District

Even if you do not have children who will be attending the local school, it is essential that you still consider the local district. If you choose to sell your home later on, you want to make sure that your home has as high of a property value as possible.

Do Wait Until You Are Ready

There is absolutely no reason to buy a house before you are actually ready to do so. Ensure that you are putting down the money only where you can afford. You do not want to be stuck with a foreclosure on your hands.

Even if you do not have experience buying a home, you now have a few pointers to remember when it is time to make that initial bid.