Homebuying can be both exciting and nerve-racking as it requires elaborate research and lots of smart budgeting. For starters, you need to check your credit score and determine which type of mortgage you can qualify for. Then, you need to find your dream home, make all necessary inspections, and go through a lengthy conveyancing process. To simplify the homebuying process and help you get the best deal, we are listing six tips you should keep in mind when purchasing a new home.
Strengthen your credit score
Most people buy new homes with the help of loans provided by banks and mortgage companies. These institutions impose strict credit requirements on their clients, and in order to be able to negotiate smaller monthly payments, you need to have a strong credit score. If your credit score is unaccountably low, you should pull out your credit report, and check if you’ve been wrongfully penalized. Finally, you can try to strengthen your credit score by paying off all of your short-term loans before you take a mortgage.
Take rural locations in consideration
Even though most young people nowadays would rather buy expensive houses and flats in the city, there are many reasons why they should take rural locations into consideration. For starters, homes in county towns are very affordable, and county towns within the comfortable commuting distance are great places for raising a family.
These homes usually come with bigger backyards, which can be used for agriculture and various leisure activities. Expensive city sport club memberships for kids can easily be replaced with hiking and fishing trips, so raising children in rural areas is also cheaper. On top of this, neighbours in these small towns usually form tight communities, and lifelong friendships are quite common.
Conduct necessary valuations and inspections
People who aren’t legal construction and real estate experts should use professional valuation and inspection for determining the appropriate property price. Home inspections are very popular on the real estate market, and the company you select can visit the home you’re viewing, check its state, and conduct pest and termite inspection. In addition to this, you should also hire a professional property appraiser, who will provide you with a written valuation report, which can be very useful during price negotiations.
Score a good deal with house and land packages
Getting a good deal on a house is difficult, but it’s possible. In Australia, for instance, it often means opting for a bundle deal. Known as a house and land package, this bundle deal involves purchasing a property together with the land beneath it.
For those looking to settle in the coastal capital, opting for the new house and land packages in Melbourne comes with a plethora of benefits, including significant cost savings and far less complexity involved in the homebuying process. These bundle packages also offer the potential for development and future growth, which translates to additional financial benefits to future homeowners.
Pay higher deposits
Most people are reluctant when it comes to giving higher loan deposits. They don’t understand that the bigger their deposit is, the lower their loan to value ratio (LVR) will be. LVR is a very important metric, which you’ll get by dividing the full amount of your loan with the price of the home you’re planning on buying. For mortgages with high LVRs (more than 80%), lenders need to pay mortgage insurance. The amount of the deposit influences the overall interest and you can also use it as a chip while negotiating other repayment plan specifics.
Hire a conveyancer
Conveyancing can be hard for both the buyer and the seller, so hiring an expert conveyancer is in your mutual interest. Conveyancers provide advice and information about real estate sales, collect all necessary documentation, and conduct the settlement process. If you’re buying your first house, a conveyancer will:
- Research the property and check its title certificate;
- Deal with the sales contract and memorandum transfer;
- Put your deposit money in a trust account;
- Adjust all rates and taxes;
- Act on your behalf and advise you during the property settlement process.
Wrapping up
Buying your first home should be one of the most wonderful experiences in your life. That’s why you should conduct all necessary checks and inspections and take the stress out of the equation. Following these tips will help make your purchase go smoothly and ensure you get the best deal there is.
About the author: Mike Johnston is an avid blogging enthusiast and experienced content writer with a focus in business, technology, entrepreneurship, and real estate.
