Buying a home is an exciting adventure. You have dreams of the perfect home that suits your personality and unique style. Envision yourself sipping tea by a cosy fire or outside in the garden. But wait, before you get to that idyllic point in your life, the purchase must be made. To achieve that purposeful end, you need to ask some very important questions to get what you want in a home without overextending yourself.
What Mortgage Amount Can I Afford?
One of the most important questions for you to ask pertains to your financial health. Knowing what you can and cannot afford is a necessary dose of reality that you should have to help guide you in the right direction. Understanding more about expenditures you can realistically make is easier when using this repayment example here. It will aid you in clarifying the variety of options and nuances therein regarding mortgages and repayment options available to you.
Once you know where you stand financially, you will be in a better position when it comes time to discuss your mortgage options with different banks during the application process. In addition, this will help you narrow down properties based on affordability instead of desirability.
Is it a Good Investment?
When you are looking at a property to purchase, ask yourself several questions.
- Do I intend to live in this space for the long term?
- If not, how long do I intend on living here?
- Can I make money off this property if I sell earlier than originally intended?
- Or, does it make sense to rent instead of purchase if I plan on moving within a few years?
Those are the personal questions that only you can start and finish. They are based on your emotional response to the property and city as well as your life and career plans. Beyond these questions, some other important ones to ask before locking yourself into a mortgage include:
- What are the comparable property values in your area for similarly-sized and appointed dwellings?
- What is the local crime rate and the makeup of reported crimes?
- What is the historical trend on property values in this area?
- What kind of upgrades or repairs will need to be undertaken before you can live comfortably here and/or before you can resell in a few years?
What About Extra Expenses?
Know this – when it comes to moving homes, there are always extra expenses to be allotted for. These expenditures come about in a wide variety of forms. Here are some of the most common ones.
- Utility Bills – When you change location, sometimes your utility bills increase based on the size of the home and the corresponding increase in electricity, etc. Alternatively, your geographic location may signal a different rate scale for utilities. Contact all utility companies in advance of making any purchase decisions. Inquire about the average monthly bill payments for both the coldest and the hottest months annually.
- Maintenance Fees – Whenever you move into a home, you see the sheen of it all and how great your new adventure will be there. While that will certainly be the case, there can be some non-cosmetic maintenance fees that only become noticeable once you are living in the home. When these occur, ensure you take them seriously and have the repairs done at once to avert any future problems or repair costs.
- Club or School Fees – Perhaps you belong to clubs, or your children have school activity fees. If you are moving to a new city altogether, you may need to allot funds for accomplishing these fees to join new organizations. Ask your current clubs if you can get a partial refund and request a prorated fee at the new locations.
- Remover Costs – Unless you have both the time and physical abilities, you will likely be engaging the services of a remover company. Discuss with them ahead of time their services and your expectations. Know whether they will provide full-service packing or only haul the items away. If you have unusually-sized objects or a baby grand piano, for example, be sure to disclose that as it may affect the final cost.
And, no good discussion on purchasing a new home would be complete without the inclusion of moving tips. Watch this video for thoughtful ideas on how to plan and prepare for an upcoming move.
Prepare yourself and the rest of your family by knowing what you can afford. Ask all of the right questions so you are not caught unaware both financially and logistically. Have fun with the move and enjoy your new home.