A Leap In To The Unknown?
by Sharleen Standling
If you are thinking of purchasing your first home, and taking your first
step onto the property ladder, your head will be spinning with the
amount of advice you will come across for first time buyers.
Everybody purchasing a house before you has experienced the same things,
so you can take some comfort in that. If you know someone who has
recently purchased a house, whether it be for the first time or not, it
can be an idea to get some advice in simple terms from them.
Unless you are a person with substantial means, you will likely be
looking to purchase your house using a mortgage. Often first time buyers
do not have any money saved which they could use as a down payment, or
deposit. This means that they will be borrowing 100% of the value of the
home, and obviously repayments are going to be higher. If possible, it
is always better to purchase a house using the biggest down payment you
can afford, thus reducing your monthly repayments.
A 20% down payment is the threshold at which you're exempt from private
mortgage insurance, which can add a few hundred non-tax-deductible
dollars to your monthly payment.
If you cannot afford a deposit or down payment you must still find the
money for the closing costs of buying your home, if you estimate about
2% – 3% of the purchase price then that’s a good ball park figure.
There are many different mortgages available on the market, and some are
specifically for first time buyers. With so many lenders and so many
different types of mortgage, going for one specifically for first time
buyers is not always beneficial, so bear that in mind when you are
researching.
One last thing, and most importantly is that if you do not keep up
repayments on your mortgage, or any other loans secured on it, you are
at risk of losing it, so don’t overstretch yourself, work out how much
you can comfortably afford each month and don’t go above that. That is
one thing you must be very strict on.
About the author
Sharleen Standling is a proud contributing author. Find more articles at
http://mindbodyandsoulportal.info For more info visit
http://homeownerresource.info
or
http://homeownerresource.info/first-time-homebuyer.php