Three Steps For Stress-Free Home Buying
from daveramsey.com on 25 Feb 2011
Is buying a home fun? Absolutely! But it can be frustrating, too. Follow these tips to help make the process more fun and less stressful.
Get Your Money In Order
Make sure you are financially ready to buy a house. You need to be debt-free with a fully funded emergency fund (Baby Step 3). Ask yourself these questions:
- Can I make at least a 10% (preferably 20%) down payment?
- Can I afford a 15-year fixed-rate loan?
- Can I keep the house payments at or below 25% of my monthly take-home pay?
If you answered “yes” to all three, then you can afford a house. Otherwise, Dave strongly suggests you wait to buy a home.
Prepare for Extra Expenses
The mortgage won’t be your only monthly home expense. You’ll have all types of other costs. Some examples may include:
- Property taxes – The amount you’ll pay depends on the location of your new home. Taxes can add hundreds of dollars to your monthly payment.
- Utilities – If you’re moving from an apartment or upgrading to extra square footage, you might have a higher utility bill.
- Insurance – Don’t even try to get around this cost! You need homeowner’s insurance, which provides protection against fire, theft and some natural disasters.
Call In a Pro
A real estate agent who helps you buy a house is called a buyer’s agent. So what’s the point in having a buyer’s agent on your side?
- Save money. In most cases, the home seller pays the commission for your agent. That means you pay nothing to get expert help. It’s not uncommon for a good agent to save you thousands of dollars. Not only that, but they’ll also represent you in price negotiations. Not a bad deal!
- Save time. Without a buyer’s agent, you’ll get weighed down by countless hours of filing paperwork. Because your agent will know all of the laws and regulations specific to your city, it only makes sense for you to let them take care of all the red tape. Let the experts do their job!
Make sure you get an exclusive buyer’s agent, one who will protect your interests as the buyer.
Which real estate agent does Dave recommend for you? Find out now.