Investing In A Home: 10 Tips
Investing in a home is everyone's dream and can be possible with these ten tips. The goal is to buy smart, not to buy quick. If this is your first home, read this article before preceding. Hopefully your buying experience will be enjoyable and without stress.
- Budgeting for investing in a home. The first step in the journey to investing in a home is to have enough money to buy a house in the first place. Money that is needed must include down payment, closing cost and money for credit reports and appraisal. Normal closing cost can be as much as three to six percent of the cost of the loan, so budgeting and saving money is your first priority.
- Investigating the many possibilities of home buying. After you have enough money to buy a home, it is necessary to become informed about home buying. Learning about financing, negotiating and the steps in closing a home transaction is imperative. Read up as much as you can. Do a search on your favorite search engine for home buying guidelines. You will see hundreds of sites offering to help.
- Location, location, location. Rule number one in any real estate purchase is to buy in the best location for the money you have allowed. It is better to buy the smallest home in the best neighborhood. Keep in mind that buying a condo is not the same as buying a home. It is better to buy a little home with a white picket fence in a gorgeous neighborhood.
- Taking mom and pop along for the journey. If this is your first home, do not be ashamed to take mom and pop along with you to help choose the best home to invest. It is good to get a second opinion.
- Financing with minimal down payment. First time home buyers have many programs available to them. There are FHA insured loans with only a small down payment and there are zero down payment loans. Investigate all the financing available before investing in your new home.
- Learning how to negotiate. Do not be in such a hurry to accept whatever offers come your way. If you offer $130,000 for a small home and the seller comes back and wants $140,000, do not accept. Sit on the offer for at least 24 hours and make the seller "sweat" some. After 24 hours come back and make a counter to his counter offer. Never over extend your finances. Buy smart when investing in a home.
- Ask for incentives from the seller. Everything is negotiable in buying a home. Asking for new blinds and curtains or have the existing curtains remain is all part of the negotiation game. Negotiating for all the appliances, a home warranty plan and pool maintenance for one year is allowed also. If the carpet is in bad shape, you can negotiate new carpeting.
- Reduce closing cost. Keep in mind that everyone wants you to buy a home. Escrow companies and title companies almost always negotiate on their fees to close a deal. Both the credit report and appraisal report are negotiable, too.
- Tax savings are reasons to invest in a home. One of the main reasons people buy a home is to take advantage of the many tax savings involved in investing in a home. All the interest on the home is deductible along with points paid on the loan, interest on a home equity loan, taxes and moving expenses in some cases.
- Future and retirement plans. Planning for the future is the end result of investing in a home. A home that is invested in early will be a home you can enjoy during your retirement later on. Planning for the future for both you and your family will bring satisfaction and happiness for those years when you just want to sit back and relax.