Buying a home is one of the most significant investments you can make. It’s an exciting and overwhelming process, so it’s essential that you consider all of the factors involved before signing on the dotted line. Doing your due diligence when buying a house will help ensure that you make an informed decision and get the most out of your purchase.
1. Location, Location, Location!
The location of a property is one of the most important factors to consider when buying a house because it can affect its resale value. While you may not be thinking of moving from the house you plan to buy soon, you should still consider resale as your home is an investment.
You should also think about things like how far away the home is from amenities such as public transportation, shopping centers, restaurants, entertainment venues, schools, etc. Also, consider whether you want to live in an urban or rural area; how safe the neighborhood is; and what kind of taxes are associated with living there.
2. Inspection Reports
Having an inspection report conducted by a qualified inspector is highly recommended prior to purchasing a property. This will allow you to know if there are any potential structural or costly repairs needed before closing on the house.
The report will also provide you with information about any existing problems with the home such as water damage or mold issues that could potentially be expensive to fix down the line. It’s always better to know what you’re getting yourself into ahead of time rather than being surprised after closing on the house. With this knowledge, you can also negotiate with the seller about making certain fixes and repairs when closing on the home.
3. Budget & Financing Options
Creating a budget for yourself when purchasing a home can help ensure that you stay within your financial limits and don’t overextend yourself financially. Research different types of mortgages and financing options available so that you can find one that best fits your needs and financial situation.
A key part of budgeting involves calculating how much house you can afford and what your debt-to-income (DTI) ratio is. While the purchase price is important, there are other factors that affect what you afford, such as homeowner's insurance, real estate taxes, and maintenance fees when creating your budget so that you don't end up overspending down the road.
Your debt-to-income (DTI) ratio is one of the most important considerations to take into account when applying for a mortgage. The DTI ratio is calculated by dividing your total monthly debt payments by your total gross monthly income.
It measures how much of your income goes toward paying off debt each month and helps lenders determine whether you can afford to take on additional debt. When buying a house, lenders typically look for a DTI ratio that is below 43%, as this indicates that you have enough income to cover all of your debt payments without overextending yourself financially.
4. The Current Market
As of writing this post, we are in a seller’s market as demand is still outpacing supply. Interest rates are still around 6.8% and are predicted to rise. Buyers should be aware of the rates as well as the market because competition for desired properties can be intense; buyers may need to be prepared to act quickly and may have to make competitive bids.
5. Georgia Laws
Legally, you must have a real estate closing attorney conduct and manage your closing process. While you may not be thinking about closing at the beginning of the home-buying process, you should be sure you have an attorney in mind and consider finding someone you work well with.
The closing attorney does represent the lender, but they are there to help everyone smoothly navigate the transition. If you or the seller have questions, they will be there to help.
Have more questions about the closing process? Read our blog, “Real Estate Closing FAQs Answered,” to get answers.
Our Closing Attorneys Are Here to Help
Purchasing a home is an exciting process, but it's important to consider these important factors first to make sure it's right for you and your family long-term. Be sure to research locations carefully; inspect reports thoroughly; create a realistic budget; and familiarize yourself with different financing options available before signing on the dotted line.
Once you are ready to close, Balbo & Gregg, Attorneys at Law, PC can help you through the closing process. Our attorneys have over 40 years of experience and are equipped to help you every step of the way. We can help you understand the details of your real estate transaction and make the process more stress-free.
To schedule an initial consultation, call (866) 580-3089 or complete our online contact form today!