Itâ€™s common for first time home buyers to have many questions about buying a home, particularly about the financial aspects. After all, buying a property is no joke. It is very common for home buyers like you to feel nervous and have many concerns. This is actually for the best, since it can be easy to rush in and make mistakes when buying a property. Here are some of top questions home buyers ask and answers to them.
How do I know which property I can afford?
Set a meeting with a bank to better understand your lending options and which property you can afford. They can help you determine the price range that best fits your budget. They can also come up with an estimate of how much your monthly mortgage will be. You can also check out mortgage calculators available online for this, but these should be used for estimation purposes only.
Can someone with an average credit score buy a home?
Yes they can. The key is to find a lender who can provide affordable loan programs and do not have a strict rule regarding credit scores. Shop around for the right lender or bank before applying for a loan.
How much money do I need for down payment?
Your down payment depends on the price of the property that you want to buy. However, different lenders offer different loan options that may be able to decrease your down payment. Again, shopping around and asking for more information about the loan program will help you save money in the long tun.
Which type mortgage should I choose?
There are two major types of mortgage: fixed and adjustable rate. Fixed rate pertains to loans that have the same interest rate throughout the duration of the loan. Your monthly rate will never change. Meanwhile, adjustable rates are about loans that will change or adjust from time to time. Fixed rate loans are perfect for home buyers that plan to stay in the property that they bought for years. Adjustable rate mortgages, however, are for those who only plan to sell the home in a few years or want to refinance.
What other costs do I need to consider?
Monthly utilities such as electricity, water, parking, and internet should be factored into your monthly budget. If youâ€™re going to buy a condominium unit, then be aware of added fees like homeowner association fee, condominium maintenance fees and other payments that are required.