Can you afford your new home?
There are so many unknowns in the purchase of a new home:
Can I afford this house?
Am I paying too much for this house; will it be a money pit; will it lose valve over the long run?
Is the house in a safe neighborhood?
Are there children on the block that I can trust to play with my children?
Is the school system as good as they say?
Will I have good neighbor’s?
Just to name a few.
Can I afford this home?
It is human nature to worry about the unknown. Therefore, the best prescription for this type of mental anxiety is to learn as much as you can about the important topics surrounding home ownership. Usually most first-time home buyers biggest worry is whether they can afford the home: Mortgage payments, taxes, utilities, maintenance, etc.
Your financial institution (bank, mortgage lender, etc.) should give you a reasonable line of credit for the purchase of your new home. After all, they don’t want you to get into financial difficulties and not be able to repay the loan. Any competent real estate agent or home loan representative can calculate for you how much of a monthly payment you can afford. This figure easily translates into a purchase price figure that you can use when shopping for a home to purchase.
The second most common worry is whether the home buyer will be qualified for a home loan. It is best to get this question out of the way, before you even begin looking for a home. The financial qualifications you will need, are basically these: steady income, good credit, cash in the bank.
Having a pre-qualification amount prior to looking at homes, should help set your mind at ease. Ask your real estate agent not to show you homes above your safe limit, otherwise you’ll be back to square one, worrying if you can afford the home. Some people say, “take 80% – 90% of want your told, as your top dollar price”.
Am I paying too Much?
Another significant worry is about the price of the home. If you are getting a home loan to buy, the lender should require an appraisal of the value of the property, to make sure the value is what the seller says it is. If it is not, and you are in danger of paying too much, they won’t make the loan. This protects both you and the lender. If you are paying all cash, get a third-party appraisal on your own.
The only other question about price, did I pay too much? The solution to these question is achieved by GOOD negotiation, preferably through a realtor who will protect your interests. Check what houses in the neighborhood are selling for (ask your realtor for comps in the neighborhood). From our past experience, you do not want to be the most expensive home in the neighborhood. When it comes time to sell your home, it usually takes months if not years to sell it, even though, it is well worth it.
Why the home inspection is so important.
Now with that said and done, the MOST important component to this worrying, is getting the Best home inspection. Buyers usually only look at things such as the number of bedrooms, bathrooms, a large kitchen, fireplace, etc. and miss the big things, the things that will send you back to square one “Can I afford this home?”. Getting a qualified home inspection prior to buying your home can help you make the right choice.
No home inspector can predicate when the furnace will break down or the roof will start leaking, etc. so what should you do. By hiring the very Best home inspector he should be able to tell you what items need repair/replacement from their few hour inspection along with recommendations to be prepared to replace certain items in the house. An example of that would be “the roof shingles are nearing their useful life, spaces between the singles has enlarged, the edges are curling, the mineral stones are almost gone (expect to replace the roof in the very near future), and I estimate the roof replacement to be between $**,*** to $**,***; even though, the roof is not leaking today.
All home inspectors are not equal!
It is one of the toughest things a good home inspector can do, is to burst the bubble of a young couple to tell them that this home is going to cost them a lot of money, more than, what you are paying for the home. Only the Best home inspectors will properly evaluate the home; Is it in good structural condition? Is the house safe for people to live in? Are all the major components in good working order?
That is not to say that any home is perfect, I have found problems in brand new homes, (which have been inspected by the local town inspectors). Homes are built by humans, and we all make mistakes. It is to what degree these mistakes are made. It takes a trained expert to look beyond the visual (sometime hearing or touching) to see that a possible problem might exists. While in this new home, I closed the door to a closet, and felt the wall shimmer, then I pushed on the wall and it moved somewhat. To make this story shorter; this load bearing wall (almost 20 feet long) had only two nails holding the bottom sill plate and to make matters worse, the nails where only nailed though the plywood sub-floor. This could have been disastrous.
Instinct, is one of the most important attributes a good home inspector has, not just the Standards Of Practice that they most follow. Only the better home inspectors know the difference between cause and effect.
Home buyers should not have to worry after they have moved into their new home, all that worrying should be behind them now. It’s time to turn that house you just purchased into your home, to live in, knowing that your new home is safe for your family for many years to come.
Best advice, hire a Jersey’s Best Home Inspector, contact us today.
732.453.4498