The ultimate guide to buying your first home

Buying your first home brings with it an immense sense of accomplishment and responsibility. It feels like the official beginning of your adulthood. We understand how excited and nervous you must be about zeroing down on the perfect home. Being able to finance it the right way is also a part of the big decision. We are here to help you out with that. Read on to find out how you should go about financing your first big real estate buy without breaking a sweat:

Estimate your budget: This is the absolute first thing you need to do. Buying a home is as personal an experience as financial, and before you get too attached to a particular house, we suggest you calculate whether you can afford it. Have a clear idea of your take-home salary and calculate the monthly expenses. Only then will you be able to understand how much you can pay every month for the home. You have to leave some breathing space for property taxes and insurance as well, so have a conversation with your realtor regarding the figure you can go for.

Estimate the closing costs: For a first-time home buyer, this expense may be a little baffling. There are significant costs attached to the legalities and closing of the purchase of a house for example, appraisal, home inspection, credit report, attorney fees, homeowner’s insurance. These are fixed, foreseeable expenses and we recommend you keep aside this sum from beforehand so you can allocate your variable expenses accordingly.

Keep a fund for emergencies: Owning a home will turn out to be more expensive than paying rent even if your EMI on the home is lesser than your rent, because you have to pay for maintenance. So, we recommend keeping a safety base at all times. And needless to say, if you are already paying off other loans, stay away from the real estate market for a while! Nothing is worse than buying a home, paying through your teeth for it and then not being able to maintain it.

Enlist only the experts: While making your first major real estate deal, you will be largely dependent on your agent to get you the best deal in the market. So, you want to be sure of the person whom you are entrusting with your money.

Ease up on the expenses: The feeling of accomplishment that buying a home gives, may also bring with it a dangerous side effect: an uncontrollable urge to fancy up the home. This is a recipe for disaster specially for first timers, as you need to be diverting your finances towards paying off the home loan and keeping money for the emergency fund we talked about. Do not spend exorbitant amounts on decorating the home right away.

Now that you know the basics of how to go about with buying your first house, are you ready to get started?