November 19, 2018
Some Considerations Before Deciding to Buy a First Home
The prospect of home ownership can be exciting. As compared to renting, purchasing a home means a person is going to start building equity and making himself a more visibly permanent part of a community. And there’s undeniable lure in the dream of having a place one can consider one’s own. But before a potential buyer lets their hopes or expectations run away with them, there are considerations to keep in mind. Particularly in a housing climate like the one we appear to be entering, it’s important that people pay attention to the threshold elements necessary to have in place before conducting a property hunt in earnest:
- Does a member of the family have a job or other fairly secure source of regular income? No responsible lender will take a risk on initiating a mortgage for potential owners without this tentpole element. And it’s important that the person be fairly settled in or happy with their job, too, because the key here is the consistency of income and the personal recognition that a home-owner is likely to be more securely anchored by the home to the particular geographic area—whether that’s Jacksonville, Florida; Providence, Rhode Island; or East Longmeadow, Massachusetts—in which it is found. Which naturally means a narrowing of potential job prospects available to the new homeowner, which is generally not faced by people who can simply get out of their leases and leave the area in pursuit of a better career.
- Do the potential buyers have enough money saved away for a down payment? A good rule of thumb is that they want to have 20% (or more) of the home’s purchase price available for them to put down, plus enough for the costs associated with closing (usually between 2%-5% of the home’s purchase price) and title insurance (which, in addition to title curative services, we provide here at Topouzis & Associates, P.C.). They’ll also want to be sure they have enough income to cover the monthly mortgage payments, including any escrow, as well as the monthly bills for utilities, not to mention having enough to cover home maintenance and any potential emergencies or repairs that may arise (and yes—they will arise).
Should these initial requirements be in place and the property search proceed to its conclusion, Topouzis & Associates, P.C., is here to aid in closing. We act as a bulwark against problems of the past, performing title searches and ensuring clear title to property—and we back our services with offerings of title insurance (click here).