A Guide to Buying Your First Vacation Home
The decision to buy your first vacationhome – so exciting and so terrifying at the same time! Is the moment the right one? Can you find an affordable loan? Will you discover the place that you will immediately fall in love with?
Relax and take a deep breath. It is normal to feel nervous because the purchase of your first vacation home is a very serious step that will mark a new phase of your life. You will have to do your homework, which will enable you to understand the market. Relying on some professional assistance will be a good idea, as well.
Start with the Calculations
The financial aspect of buying a home is the one that needs to be tackled first. How much can you spend on the apartment or house? How much are you willing to borrow?
Start looking for a loan that is large enough and that offers good terms. According to the National Association of Realtors, nine out of 10 home buyers finance the purchase through a loan. The good news is that you have many options to choose among.
Pre-approval loans are one of the options. As the name suggests, you contact financial institutions and get a letter of pre-approval before you begin searching for a house. The letter will help you demonstrate your purchasing ability to the home owner. Before you get a loan, your financial information will be assessed carefully.
First-time buyers typically choose a loan that will be repaid over a period of 30 years. The interest rate can be either floating or fixed. One of the most important features for first time buyers is to get loans that are easily manageable, especially in the first few years. Buying a home will be financially challenging and you need to make sure you will be capable of repaying the loan.
Foreclosed Homes: Are They a Good Idea?
Foreclosure is a process in which property becomes the ownership of a lending institution due to the inability of individual to repay a loan. Many first-time home buyers consider foreclosed homes because of the attractive conditions.
According to statistics, nearly four percent of all the homes in America are facing foreclosure. When the homeowner fails making payments, the bank or other lending institution becomes capable of acquiring the property.
Is buying a foreclosure home a good idea? One of the biggest advantages is the considerably lower price of the property. Three purchasing windows exist – pre-foreclosure, auction and after foreclosure. First-time buyers are advised to avoid the first two windows because their offers will rarely get noticed.
After foreclosure buying is most similar to the traditional house purchase and first time buyers typically go for this option. To buy a foreclosed home, you will need a lot of patience and professional assistance. Many other potential buyers are looking for bargains and dealing with the competition on your own will be challenging.
Finding the Right Place
Once you have figured out the financial aspect of the purchase, you are ready to move on to the next step. Finding the right place for you and your family will probably be the most exciting part of the process.
Shopping around and taking notes is a must! Always check the condition of the kitchen and the bathroom because they will tell you a lot about maintenance. Additionally, bathroom and kitchen modifications can be the most expensive aspect of renovating the home.
Determine the things you definitely want and the ones you are ready to compromise. Tell your agent precisely what you are looking for so that you can get to see properties corresponding to your requirements. Daydreaming is fine but when it gets to seeing apartments and houses, you need to have rational and realistic expectations.
Hurray, You Found Your Home! Now What?
Once you are 100 percent certain that you have discovered your dream home, you will have to get yourself into negotiations mode.
Make an initial offer on the basis of your agent’s advice or a consultation with another trusted professional. If many people are showing interest in the same property, your first offer should be the best one. In the case of a slow market, you will get more room for negotiations.
As a buyer, you have a lot of power. Be smart about your requirements and always start with the financial aspects of home buying. Spending time on familiarizing yourself with the market and with the loan options will give you access to the best terms and conditions for your needs.
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