Buying a house is a big financial decision which comes up with many intimations. The home hunters keep on asking if there are any financial advice rules to follow while making a purchase. Fortunately, there are! The common advice is to investigate if the person is ready to make the jump to homeownership in a simple way. Though these rules are quite simple, buyers don’t follow them on a general note. They keep on buying the houses without following any of the house rules. As a result, the financial situation doesn’t fall into the right place.
A simple and straight query here is what is the use of these rules? You can take it as a set of guidelines that a buyer needs to follow when searching for the Medallion Flats Mohali. These rules will help you stay out of financial issues. Each of the rules has its own importance and the buyer needs to keep a close eye for getting the best deal. Check out each of them!
1. Emergency fund
A person must keep money aside to get coverage of unpredicted expenses in their life. It is very essential when you buy a house. Do you know the reason? This is because homeownership brings a lot of expenses, which can be sudden and large. Keeping a backup plan for the expenses is a must for every home buyer if they really want to avoid future financial trials.
Keep the emergency fund in place before you search for the property or purchase one. This should be done 3-6 months before the expenses. However, this rule can be crooked, but not completely. Don’t flex it for longer durations! When you plan to buy a home, start saving the most you can. Not having money on your side can lead you into big trouble. The more cash you will have, the better your position will be.
2. Setting up and following a budget
Not only your mortgage payment but there are other expenses too like the real estate tax, homeowner insurance, utilities, maintenance expenses, and the associated fee of homeowners. Now the buyer will also take a mortgage debt, they will also need to expand or purchase the new life insurance. As a whole, you need to set up a solid budget for all your new billets.
Again, this rule can also be bent but at your own risk. It is always advised to prepare a budget before buying a house so that you have a clear vision if you will be able to meet the big changes in the end. Overlooking the efforts of adding numbers and misjudging your affordability can drag you into trouble. When you are fully prepared for all the financial challenges, you can easily purchase a home.
3. Saving up a down payment
A person may get a loan that sets him free from high or no down payments. But making a down payment is always a good idea. When the real estate markets witness a drop and you have to sell your house before the market recovery, you will still have the money with you to beat that shortfall. You will get a straight escape from the situation of owing more mortgage than the property is worth.
You can bend this rule too if you are qualified for some specific type of loan. You are putting yourself in the situation for some vertical financial challenges in which you may have to sell your home. The price of a home is not enough to pay the mortgage and the other selling prices. These circumstances can make you rent the house but not sell it, restrict you from purchasing another home, and push you to sell other assets for the cash payment. Money problems will arise in such cases. It is better to put down the upfront to avoid such problems.
4. Job security assurance
For most homeowners, their take-home pay gets gobbled by the household expenditures than any other classifications within their budget. Make an addition to the loyalty of homeownership and you will get a clear vision of the sustainability of the earning power. If you are a family with a double income, you should limit the purchase of a house of one income. Remember this rule cannot be bent!
5. Keeping the house for long
If you couldn’t think of owning a house for at least 5 years or more than it, waiting may be the option for you. If possible, try to bank some of the basic shares for the housing and then purchase when the time is perfect. This rule can be distorted! The local realtor can help you in this situation by offering the assimilation of Medallion Mohali Price List trends in your interest area. Keep track of this term too!