Buying your first house is an exciting milestone in a person’s life.
Here are the top 10 facts about buying your first house.
Three out of four homeowners say their home is their biggest source of wealth. The statistic comes from the National Association of REALTORS® (NAR) survey and demonstrates just why it is so important to become a home owner in America. Remember, this means your house is not just a place to live, but also an investment in your future.
Stretching to get into a home you can’t afford is a bad idea: Millions of homeowners lost their homes to foreclosure in 2008 and 2009 as a result of using creative financing to get into a house that they couldn’t really afford. Make sure you figure out your budget and determine exactly how much you can afford to spend. Then, take a mortgage loan that makes sense to you and that is not likely to increase to such a high level you can’t possibly pay (as may happen with some adjustable rate mortgages).
You should have a down payment: Banks and mortgage lenders want buyers to have a down payment because that protects the lenders. If you have a down payment, you have equity, which means you own a portion of the home. If property values fall, you are thus less likely to end up owing more on the home than it is worth. The down payment is so important to lenders that if you don’t have one, you will be required to pay private mortgage insurance (PMI).
You may have to pay closing costs to get a mortgage: These costs include appraisal costs, inspection costs, application fees for your mortgage loan, a title search and various other expenses. You usually either have to pay them up front or they are added to the cost of your mortgage and you have to pay them over time. Occasionally you can negotiate a Deal wherein the seller pays the closing costs, but this is not very common.
You can get pre-approved to find out how much you can afford: Before you even begin looking at houses, you can go to a bank or mortgage lender with your financial information and find out just how much they are willing to lend you. That way, you can look only at houses in your price range and you won’t end up falling in love with a home you can’t afford.
The seller may pay the commission for your real estate agent: In most cases, buyers do not pay for their agents. Instead, the seller pays three percent to the agent who helped sell the house and three percent to the buyer’s agent who helped you buy it.
Real estate investments are widely considered a hedge against inflation: Inflation refers to the falling value of the dollar. In other words, the purchasing power of $1 will be less tomorrow than it is today, since goods tomorrow may cost slightly more. Since real estate is a tangible asset that rises in value, it is usually considered to protect you against this phenomenon, at least to the extent of what your real estate is worth.
Mortgage interest is generally tax deductible: This means you can reduce your taxable income by the amount of interest you pay. If you make $50,000 for example, and your mortgage interest is $9000 per year, you can deduct that $9000 to reduce your income to $41,000.
Be prepared for property taxes: Property taxes are determined by the assessed value of your home. They have to be paid to the county every year or the tax collectors could take your house.
Know how long you plan to stay: Generally, it only makes sense to buy a house if you plan to stay put for at least two years. That is normally how long it takes for your property to rise in value enough to make up for what you spent on closing costs and on originating the mortgage loan. Furthermore, if you live in a house for less than two years, you may have to pay more taxes on the amount you make on the sale. This, and other factors- such as what the housing market in your area is doing- should be considered before you decide to buy.
Author:Victoria Schweyher Phone: 908-472-5540 Dated: June 18th 2016 Views: 62 About Victoria: ...
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About Ellen Dell'Alba - Team Leader of the Platinum Group:
Ellen is one of the most diverse realtors among the Keller Williams Realty Agency in Monmouth & Ocean Counties. Being with the company for several years, she continues to make considerable strides in becoming the best realtor she can be. Ellen is a listing specialist, along with having certifications in ABR (Accredited Buyers Representative) and BOLD. Her strategy in helping her clients buy or sell a home is fairly simple: "I do whatever it takes to make my clients 110% satisfied, and that is my personal guarantee!"
Ellen attributes her impressive 80% property sales rate to her relentless drive and work ethic. Working around busy schedules, offering multiple open houses, hosting Broker Lunches, as well as spending a considerable amount of time and money in advertising are just some of the ways Ell en makes sure her client's listings get maximum exposure.
Ellen's view when it comes to home buying is: A home is not a home because of its room dimensions or the color of the walls. It is about how you feel when you walk through the front door, and the way you can instantly envision your life unfolding there.
Ellen resides in Ocean County, NJ with her husband and five children.
"I appreciate the opportunity to earn your business and look forward making your experience buying or selling a pleasant one. Invite me in and let me show you what your home is worth and how I can get you top dollar!" - Ellen Dell'Alba
Real estate market data for Jackson, NJ provided by Ellen Dy
"Ellen was an enormous help when I decided to downsize. I was never left hanging for answers to my questions. Her response time was impressive to say the least. From multiple viewings, negotiation, inspection , through to closing, Ellen displayed the utmost professionalism. I would not hesitate for a second to work with her again and highly recommend her. You will not be disappointed."