One of the main goals of many newly married couples is to find a new home to share and start a family. However, because buying a house together is going to be one of the biggest purchases they ever make, it’s important they don’t rush into the homebuying process too quickly. If you and your new spouse are looking to buy a home, then be sure to follow these steps:
Determine what you can afford
One of the biggest mistakes newly married couples make is to overestimate what they can afford. Don’t assume you can simply add what you and your spouse make together, and use that figure to determine your budget. You need to sit down with your spouse in order to identify not only what you make, but also what debts each of you has. You may even not be aware of your spouse’s debt, and vice versa. Go over each other’s credit card debt, student loan debt and other financial obligations to get a better idea of where you stand financially as a couple.It’s also important that you take into account all of the costs associated with owning a home, besides just the monthly mortgage rates. This includes utility costs, property tax, HOA fees, homeowner’s insurance, maintenance fees and possible repair work. First-time homebuyers often neglect to consider these costs, which can lead to serious financial trouble down the road.
Go over both credit reports
In addition to going over one another’s debts and income, you should also obtain a credit report for both you and your spouse. If one of you has an excellent credit score but the other has a poor credit score, that poor credit score could hinder your ability to qualify for a mortgage. Even if you do, you may not qualify for the best terms. Before you even meet with a lender, you should begin working on improving both credit scores. You can do this by checking for errors in the credit reports, paying off debts and paying down credit cards.
Improving your credit scores may require some patience for newly married couples who want to start their lives off in a brand-new home; however, it’s worth waiting until your credit scores are in good shape so that you can qualify for lower interest rates and better terms. You don’t want to be paying thousands of dollars more in interest over the course of 30 years just because you couldn’t wait a little longer to buy a house.
Even if your credit scores are good, you may want to hold off on buying a house until you’ve saved some money. If possible, you should save enough to put a 20 percent down payment on a new home. If you can’t put down 20 percent or more, then you’ll end up having to pay mortgage insurance every month, which is an additional financial burden you won’t want. Additionally, you’ll want to have some money left in savings to pay for financial emergencies that might come up. Moving into a new home without a cent to your name is never a good idea.
Obtain a mortgage pre-approval
If you and your spouse have money in savings, and your credit scores are in good shape, then you’ll want to go get pre-approved for a mortgage before you begin your search for a new home. Not only does a mortgage pre-approval ensure that you will be able to qualify (thereby avoiding wasting your time looking at houses if you don’t), but it will give you a good idea of how much you’ll qualify for, which gives you a budget to work with. Keep in mind that even if you qualify for a large amount, it doesn’t mean that you have to buy a house that costs that much. Your budget can be less than the amount you’ve qualified for.
Put together a wants and needs list
After you’ve obtained a mortgage pre-approval, sit down with your spouse and go over what you want from your new house. Many couples assume that they are on the same page, which leads to a lot of arguments over the course of the house hunt. There’s no point in wasting your time looking at houses if it doesn’t meet all of your needs, after all. Sit down and prioritize your wants and your needs so that you’ll be on the same page when looking at houses and so that it will be easier to make compromises if it comes to that.
Speak with a real estate agent
A real estate agent will find listings based on your wants and needs while keeping your budget in mind. In addition to identifying houses that are for sale in the area you are looking, they can tell you if your list of wants and needs is realistic for the budget you have, help you identify good deals and bad deals, help schedule showings and help with the negotiations. Not only can a real estate agent help you find a home, they can help you save time and money.
Just because you got a mortgage pre-approval from one lender doesn’t mean you have to use them for your actual mortgage. Go to several different lenders once you’ve found a home that you’re interested in and compare the terms that they offer. You can always fall back on the original lender who pre-approved your mortgage, but you may find someone that offers better terms, which could end up saving you thousands of dollars in the long run.Couples who are recently wed are often excited to get on with their new life together. However, when it comes to buying a house, it’s important to take a step back instead of rushing headlong into a home purchase. Take your time and follow these steps to ensure that you end up in a house that meets both your needs at a cost that you can actually afford.
You have worked hard, sacrificed, saved your money and now you are ready to buy a home. There are so many factors to consider and tough decisions to make. The whole idea of buying a home is exhilarating and sometimes daunting at the same time. One of the critical decisions you will have to make is whether to buy an older home in an established community or new construction in an up and coming area. There are pros and cons to each, of course. In the end, your decision may come down to personal taste. While you are thinking it over, consider a few of these undeniable advantages inherent in a newly-constructed home..
Contemporary Floor Plans
Today’s buyers are almost unanimous in their desire to live in homes with “open concept” floor plans and they are more than willing to grab a sledgehammer and knock down walls to achieve the open look and feel. Assuming they are not load-bearing, knocking down walls is fairly cheap and a great way to let off a little steam.The expenses start rising quickly, however, when you go to refinish the space and pull it all together visually with matching materials.With new construction, this will not be a problem.Almost all builders today are constructing new homes in line with modern sensibilities and preferences.That equates to open spaces with tons of natural light and combined great rooms/kitchens that allow for comfortable entertaining and the ability to keep a watchful eye on children while preparing meals.
A Blank Slate for Your Vision
A newly-built home allows you to summon your inner decorator and go to work in decorating the home of your dreams. With new construction, there is no need to spend endless hours tearing off old wallpaper, ripping up wall-to-wall carpeting and wondering when you will ever get enough money together for updated kitchens and bathrooms. What the average price of a simple kitchen remodel in North Carolina is over $20,000, and bathrooms run at least $10,000.It takes most homeowners years to put together this much extra money.Why not start your life as an owner with brand new kitchens and bathrooms that will look good for decades?Save your money for the finishing touches that will help make your house a home.
Cost-Saving Energy Efficiency
There is simply no comparing the built-in energy efficiency in new homes vs. older homes. Even a house built in the 1990s or early 2000s cannot stand up to the energy-efficient features in today’s new construction.Much older homes often cost a small fortune to heat and cool.In new construction, everything from appliances to windows, insulation, roofs, HVAC systems, and lighting take advantage of the latest technologies to create energy-efficient homes with reduced utility expenses.
New construction shines, glistens and gleams and comes packaged in a pretty new bow. Older homes come with an extensive list of deferred maintenance items in need of attention.Seemingly minor repair and maintenance tasks often unearth hidden problems inherent in an aging structure and, before you know it, your dream home has morphed into a big money pit.If you prefer to hold onto your money and spend your free time with family and friends pursuing other activities and interests, then new construction might be your best bet.
Home Owner Warranty Programs
What is a homeowner to do if that beautiful home you bought is springing leaks every time it rains? If you purchased an older home, you probably took title to the property “as is” which means you have no recourse and better figure out a way to pay for a new roof – and soon. Owners of new construction have protection against defects in workmanship and materials through Home Owner Warranty Programs paid for by the builder. They also have the peace of mind that comes in having that protection.
Older homes can be charming and a welcome challenge for a buyer who can handle the added expense and responsibility of owning an older home. If you are not that person or lack the cash reserves, resources, talent, and motivation to become that person, consider the advantages of buying new construction and take the first steps toward a stress-free, low-maintenance lifestyle that will leave you with the extra time and money to pursue all your dreams.