Some Pieces of Advice for the First-Time Home Buyers in Bahria.

  • 12 months ago
  • Blog
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Know your budget

Before you get emotionally attached to a beautiful house, check your monthly budget to
determine your ability to afford a house or real estate asset. You need to leave room in your
budget for other things, so make sure your monthly housing costs are going to be no more than
25 percent of your monthly take-home income.

Check the home property guide

Home property guides are often helpful. These guides contain potential information about real
estate records. You can make more informed decisions about buying a property when you know
how old it is, what it last sold for, and how it compares to similar properties in the same or
different areas.

Pre-approval for a mortgage is good

If saving up to paying the total price of a house in cash isn’t reasonable for your family’s timeline,
at least save for a down payment of 20 percent or more. Then you won’t have to pay for Private
Mortgage Insurance (PMI), which protects the mortgage company in case you can’t make your
payments and end up in foreclosure. PMI usually costs 1 percent of the total loan value and is
added to your monthly payment. Hence, purchasing a house starting from paying a down
payment is a cool option for the buyers.

Acquire Adjustable Rate Mortgage if required

Adjustable-Rate Mortgage (ARM) loans are also available, where the interest rate is fixed for a
certain length of time. After the term expires the interest rate becomes adjustable in increments
each year. These loans give homeowners the chance to have a lower interest rate with time to
gain equity before the interest rate adjusts. Adjustable-Rate Mortgage can easily be achieved in
the countries where financial inclusion is minor.

Hire a real estate consultant

Let’s say you found the home you want and can afford according to your wish. Since you’re
already preapproved for a loan, you’re ready to make an offer. If you’re a first-time homebuyer,
it may be hard to know how much you should offer. That’s when you can rely on the expertise of
your real estate consultant. Ask your real estate consultant to help you make sure your offer is
competitive but also within your budget and the home’s value. Be careful not to make an
impulsive offer that’s higher than you can afford just to knock out the competition.

Insurance for your home

  • You need building insurance for the duration of your home loan. Mostly, banks offer home
    insurance.
  • Building insurance – It covers the building structure damage caused by fire, storms, theft or burst
    geysers.
  • Home Contents Insurance – It covers the contents from loss or damage caused by theft, fire or
    storms.
  • Car and Home Insurance – It is comprehensive insurance that covers your building and vehicle
    protection plan.

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