Owning a home is a significant life achievement for everyone. It entails having the option to transform a house into a home. Additionally, it is a critical step in building a stable financial future.
Apart from the actual cost of buying a house, there are other things you will need to be cognizant of and prepare for. With the help of insurance company, Old Mutual and bank, Standard Bank we have compiled a list to help you acquire your first home.
1. Up your credit score
Your ability to obtain a home loan and the loan amount you will be approved for will largely depend on your credit score. Unless you’ve saved a huge amount of money and can pay for your new house in cash, you’ll probably need to get a loan for at least a portion of the purchase price , if not the whole amount. A good credit score will speak on your behalf.
2. Get a pre-approved home loan
Making sure you have a pre-approved loan is one of the best ways to increase your negotiation power. This makes the seller feels more at ease knowing that you are eligible for the offered price. Obtaining pre-approval will help you narrow down your search by giving you a better understanding of what you can actually afford.
3. Opt for a short bond repayment plan
Choose a bond repayment plan with a period as short as possible to lower the total cost of your mortgage. This means you will pay more money in a shorter period of time, and end up saving more money in the long run. If this will put an additional strain on your already tight budget, you might want to think about going with the longer repayment plan.
4. Research the area you’re considering
Make sure the sale price of the property you are interested in is consistent with the area’s typical sales price. The degree to which the place fits your overall way of life should also be taken into account:
- Commuting
- Transport options
- Nearby schools
- Shops and other conveniences
- Security
You can always adjust a property’s features you don’t like, but you can’t change the location, so give the location great thought.
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