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What You Need To Find the Perfect Home

April 03, 2008  |  Difficulty: Easy

Path to mortage
Having a good understanding of what you need to find the perfect home is the difference between a good homebuyer and a not so good one. When you know what you need, you are on solid ground. You know what is feasible and pleasing, and that is what matters most.  

Let’s say you are earning money that puts you into the middle class category. You have been living in an apartment and you are comfortably making monthly rental payments consistently. You saved a little amount of money for a down payment because it’s time to move up into home ownership. Now that you are ready to move into the pre-approval process, you need to ponder on these facts to keep yourself from getting into a financial bind.

Since you have solid credit rating, your bank will most likely approve you for a larger amount of money. But if you are smart you will accept a mortgage that will average out to be around the same amount as your previous rental payments. Why is this smart, you ask? Well, you were able to save money here and there when you were renting, but it wasn’t a whole lot. When you own a home you will be paying not just for the mortgage but you will have to take into consideration property taxes. Also, extra money will be needed for the other costs that pop-up when you own a home.

But you could be making a little more than average, and you might live with someone who is doing just as well as you are. During the pre-approval process you should still think about the amount of your monthly mortgage payment. You don’t want to have a payment that leaves you little money to do other things.

A lot of mortgage loan companies will approve you for a larger amount of mortgage than you really need, or can actually afford. Some people get approved for mortgage that is over three times their salaries. But what if you want to take vacations, make other investments or renovate your new home? Making sure you get a mortgage that is reasonable and will leave you money to do other things with your life!

After considering your budget, what can you do to understand what type of house fits your needs? Especially when you do find a home that is within your budget?

Make a list of the things that you will need. Take this list along with you to each house. When you take the tour, see how the house compares with your list. If you are using a real estate agent, share this copy with him or her. Have a discussion to see what features are essential and what can be negotiated.

This is also a good plan if you are buying a home with your significant other. You and your partner can take a copy of the list and use it to take notes while touring the homes. After the tour share the notes and comments that each of you made.

This can be a tedious process. Your real estate agent may try to “nudge” you into buying a house that seems to fit your needs. But if the prospective home does not match with your list, follow your gut. Don’t get pressured into buying something you don’t really want.

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