Making an investment of any kind doesn't just mean handing over an extra set of hundred dollar bills. With every large investment, there are specific rules and processes that are defined in order to ensure that your money will be going to the right place. If you are investing in real estate, you will want to know what initial investments will be.
If you have found a home and are beginning a process for buying the home, you will begin to make some initial investments soon after the first contract is signed. Most real estate investments will require a down payment, which includes a set amount of money towards the person that is selling the home. This will then be put on your credit towards the investment that you are making. If you have extra money set aside, you will want to put it in the down payment, as this will make a difference in your investment later on and can help with final approvals for the loan that you are receiving.
Another set of investments that you will be making is for any extra costs from the team that you have built. For example, a home inspection will usually cost a small amount of money. There may also be extra fees linked to the lender's paperwork and other things that are related to things such as the contract. Every person that is working with you will receive a commission or part of the investment that you are making in the beginning.
Before you begin house hunting, make sure that you know about the initial investments and how it will affect your bank account. Setting aside a specific amount of money for your first home, or knowing how much to include in a down payment after buying a second home will help you to make the right investments from the beginning. You will want to make sure that you walk into your dream home with enough money to get you completely in the door.
The Myth of “Love at First Sight” When Home Buying
“Love at First Sight” should be replaced in your mind with “look before you leap.” The myth of love at first sight when home buying has gotten many people in trouble financially and emotionally – and it could all be avoided by keeping some tips in mind before choosing based on love at first sight.
You may fall in love with the first house you lay eyes on. It may seem to have everything you’re looking for in a dream home. But, you’d be wise to check out and compare others to be sure it’s what you truly want.
In fact, it’s best to view as many homes as possible to ensure you’re making the correct decision. You don’t have to look at every home in the area, but comparing at least three is the rule of thumb.
One reason to compare and shop around is that you may find other features you like more in another home. You can then compare the features and decide which you like best and which would benefit you the most as a homeowner. And it could have a lower price tag.
Rushing to closing without the proper inspection and close examination for red flags that might haunt you later is one of the worst things you can do in the home buying process. It’s possible they won’t find anything and there are no red flags to alert you to future problems – but it could save you much money in the long run.
Checking out other homes can also give you a good idea about the resale value of homes in the neighborhood or other neighborhoods you may be considering. When you purchase the best home in the area, know that your home may not appreciate in value as much as other homes surrounding you.
While you may love the home – take into consideration where it’s located. A great house in a bad neighborhood may become a nightmare you have to live with even if you’re in love with the home itself.
Most home buyers ask about amenities and the age of certain areas of the home, but don’t ask some pertinent questions such as inquiring about pests, recent repairs on the home and the cost of taxes each year.
Think about your future plans before falling in love with and purchasing a home. Is public transportation something that you need to look at? Are you far away from your work and would have to spend hours in traffic both to and from work? Look at your lifestyle and find out what’s really important to you.
You’ll likely walk through the home several times before you sign on the dotted line. Each time, be sure to scrutinize the property like you’re making one of the most important decisions of your life – because you are.
If you take your time, be honest with your real estate agent and your lender and don’t jump in to buy a home at first glance, you’ll be much more confident in the decision you make.
Kirk Rickman, Victoria Carter and Scott Horslin
TwoMoveYou Real Estate Century 21 Brighton
6 Ironwood Cres, Brighton, ON K0K 1H0