The very thought of buying a home overwhelms us. In our experience with hundreds of buyers, we have observed that finances and the legal process are more intimidating than other aspects involved in home buying. So, what are the points to consider when looking to buy property?
Plan costs efficiently
First time home buyers may often consider just the down payment while saving towards a home. There are other initial expenses involved in property purchase – like stamp duty and registration costs, utilities connection charges, insurance and taxes. Also, you need to keep aside at least 6-7% of the base cost of the property available. We do not advise that you avail personal loans for these payments – if you do, keep it as low as possible. A credit trap at this stage is best avoided.
Calculate monthly expenses
Figure out all financial aspects like your overall household costs. Set aside a portion of your monthly income into a retirement plan. Then and only then, you should calculate the monthly mortgage on your home loan. The value of principal and associated interests, as well as insurances, taxes, maintenance charges, utilities charges should not exceed 35-40% of your net income. Hire an experienced financial planner to help you.
Always be realistic
Don’t get tempted by discounts and extra offerings or the possibilities presented by that big flat. You can always upgrade as financial ability increases. Never compromise your financial stability for extra amenities. There is nothing more important than sustaining financial stability through the home buying journey.
Competitive interest rates
Get home loans which have competitive interest rates. Look into buying a property along with your spouse. Find out about incentives offered for taking a joint loan with your spouse. You are not required to take the first offer from the bank – most banks have a considerable margin of flexibility to accommodate determined borrowers.
Credible developers
Conduct multiple checks to make sure the developer has a strong reputation on the market. Interview reliable agents, the home loan company and search internet forums for established developers with an easily verifiable track record for timely completion of projects and 100% adherence to the agreements with customers.