Top 5 Questions When Buying a House
To most prospective homebuyers, the process can look daunting. Making the transitioning from renting to owning your home is likely the biggest financial investment you’ll make in your life, and there’s little margin for error. Here are the top 5 questions to consider when you’re ready to take this leap:
1. What Can I Afford?
In the wake of last decade’s housing crash that led millions of Americans to become underwater on their mortgages, it’s smart for prospective homebuyers to be honest with themselves about how much house they can afford. Most financial experts recommend that no more than 35 percent of your pre-tax income should be spent on housing payments (including a mortgage, property taxes, and insurance).
2. What Location Fits My Needs?
The age-old adage about the most important factor in real estate holds true today. How far away from the city do you want to be? Does the area you’re considering have good schools? What type of neighborhood demographics (young professionals, families with young children) are you seeking?
3. What’s the Condition of the House?
Have there been any recent pest infestations? Roof leaks or mold? Are there warranties on all of the appliances? Given that this is the place where you and your family will be spending your days for the foreseeable future, it’s important to have all bases covered and ensure the seller takes care of any outstanding problems before the paperwork is signed.
4. What’s the Utility Situation?
Some homes in community developments will have a Homeowner’s Association Fee (HOA) that will cover some or all utilities for owners. If not, learn about what kind of power the house uses, what it costs, and if there’s any wiggle room.
5. Are There Any Outstanding Legal Issues?
Is the current owner involved in a property dispute with his or her neighbors? Are there any outstanding debts, or liens placed against the home? When buying a house, you’ll also inherit its problems, so be sure to keep everything above-ground!