Having decided that the time is right to take the risk and finally buy a place of your own, one can begin to feel a bit insecure about the whole process. While being fully aware that proper research is necessary before deciding on the purchase, one is not always sure what exactly it implies. Fortunately, we have prepared an extensive list of steps that need to be taken, and which matters require checking, before you finally agree to buy the place. As you shall see, some of them are often overlooked, even though they can be actual deal-breakers.
Credit score
Perhaps this comes as a surprise, but let’s start from you. Have you wondered if your credit score is good enough for the loan? If you are used to spending more than you have, now would be the perfect time to stop. Potential lenders are going to look for the red flags, i.e. any periods of time over 14 days when you were late for the payment. If this is your habit, now’s the time to break it before doing anything else.
Find the lender
Once you find the home, it’s best to already know who you can turn to when the time comes. Since you already have a price range in mind, and a nice credit score, it’s advisable to see what good interest rates there are. The easiest way around this would be to consult with a reliable home loan specialist who can present you all the options available (for example according to Lendi, during the last 12 months ING Direct had the lowest interest rate of 3.58%).
Visit the urban department
When you have found the home(s) you like, this is what you do even before looking around the neighbourhood. Pay the city’s urban development department a visit and check what their plans for the area are. Is there going to be a new busy road near your house, or perhaps a recreational area? These can greatly affect the future price of your home, not to mention your daily routines.
In addition, now that you are there, ask about whether the area belongs to a residential, or a commercial zone. No matter what the place looks like at the moment, it can change in an instant once a new business complex is built right next to you, or perhaps a multi-family rental. The building boundaries should be made crystal clear.
Check for remodeling restrictions
Research says most people have a plan on living for 15 years in a house before putting it on sale. During this period, you’ll probably have the urge to remodel your home, especially before selling it. However, the buildings in the area can have all kinds of restrictions imposed. There are cases when building another floor is forbidden, or changing the façade, planting or cutting a tree, and so on.
Even if you definitely don’t need a new garage or a guest house at the moment, when you decide to sell, you will may wish to add these.
Get the home history
By this, we mean if it has been on sale before. If the answer is positive, check for how many times, how long it took for it to be sold, and how long it has been on the market now.
Another part of the history concerns monthly expenses. You will need to see the copies of insurance policies, utility, tax bills, and homeowner association fees.
Inspect the deal-breakers
In no particular order, these would be: location in a high-risk flood zone, problems with sewer lines and other plumbing, a roof which must be replaced, an electrical system that needs to be updated, evidence of pest infestations or uncertified building additions. They could cost you dearly if you aren’t do not do your due diligence.
Explore the neighbourhood
There is more to it than simply walking around the area and looking at houses. First of all, make sure you visit the place at different times of the day. This will tell you if it’s mostly peaceful, or there are times when everyone’s commuting and creating lots of traffic. Also, see about the transport options from your future home.
Find out if there are any schools in the area, and read their reviews. Even if you don’t plan on having children, maybe your future buyers do.
Go smart window shopping. This means you will be looking at the local shops and checking if the businesses here are doing well or not. That is the perfect indicator of how well off people are, or what they are interested in buying. Basically, this speaks volumes about the neighbours’ mindset.
Crime rates
Even though it seems like a perfectly nice neighbourhood, try to find out if there have been any recent crimes, and of what kind. Talking to the neighbours and people working in the area certainly helps to get the idea about the safety.
As you can see, there is a lot to take in. Nevertheless, do one thing at a time, and you can rest assured that when the time comes you can be confident in your purchase.