Many first time home buyers out there end up bankrupt because of an unrealistic way of looking at their capability to pay for their investment. So, when you are one of those first time home buyers, it is wise to read a lot and take heed of wise counsel so that you don’t get caught up in the cold midstream. The first thing that a streetwise financial adviser would give you would be that you should make sure what you are going to buy is within your capability to pay — whether in full-up front or by installment through time.
There is nothing more pleasurable than to purchase, amortize and finally own a home that agrees with your lifestyle, financially and aesthetically. You should not “over-buy.” This means you should not purchase a house that’s too big or too grand or too posh for your means to pay for. That’d be an overkill, especially if you are a member of the mid-range or lower income bracket. Knowing that institutionalized professional lenders, like the banks or real estate brokers, could pad the purchase cost with exorbitant hidden charges that could bloat the price in the long run, it should be your last option to go to these institutions.
When you have found the house you’d want to really cherish and nurture and call your own, and you find it’s really not too big or too expensive — it’s just that you are short of cash, then it’s time to strike a bargain directly with the owner first, and inquire about the famous owner-financed arrangement. If you are lucky, the owner just might allow you to just pay the down payment and then pay the balance on an installment basis.
The premise here is that the owner does not have to follow a rigid schedule of payment and hide service charges that could unnecessarily bloat the loaned amount — but there is no law that says he could not touch the ceiling in terms of government-allowed interest on the balance of the loan; the owner also does not need to pay the government-imposed taxes until the sale is closed (meaning the buyer has paid up the last installment for the property in question).
These are only a few of the useful tips for first-time home buyers. There are more to reckon with out there, and it is wise for first time home buyers to be counseled into educating themselves first before plunging head on into an investment as big as buying a property that is going to be the first home of your very own.