Buying a house is, in short, one of the most important financial decisions throughout life, however, it is common for mistakes to be made. Therefore, identifying them and knowing how to avoid them is the key to making a good decision.
1. Not having a planned budget
The basis for starting to look for your next home is to establish a budget, not being clear about it can compromise your finances. Experts recommend that debt for financial obligations should not account for more than 30-40% of the monthly income of the family nucleus.
How to avoid it?
· Evaluate your sources of income, your fixed and variable expenses. This way you will have a clear vision of your finances and you will not affect your economic well-being.
· Use a financial calculator to visualize how much your monthly costs would be or how they might change over time.
2. Overlooking additional expenses
To know if you really found the perfect house, there are some expenses that you must take into account such as: notarial processes, taxes, appraisal of the property and, believe it or not, the move. These costs can add up to a significant amount and be not-so-pleasant surprises down the road.
How to avoid it?
· Know the exact value of taxes, these can vary by area or type of property.
· Research all associated expenses and include them in the budget from the beginning.
3. Not knowing the area or neighborhood
Before making a purchase like this, you should familiarize yourself with the area, its infrastructure and its amenities. Not knowing the environment can influence the quality of life and the valuation of the property.
How to avoid it?
· Make sure the area has accessibility to amenities such as public transportation, educational centers, and commercial services such as pharmacies and shops.
· Talk to the residents to learn all about the area, they can give you a more detailed opinion on safety, the environment and maintenance.
4. Choosing the right mortgage
Financing is the best tool when making this type of decision, however, no one wants debts that mean a headache with high interest rates or unfavorable conditions.
How to avoid it?
· Compare the available options, evaluate the interest rate, term, and associated conditions.
· Know your credit history to get an idea of what type of credit you can apply for.
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5. Buying without advice
Buying a home can produce quite strong emotions and lead to impulsive decisions, leaving aside important issues such as legal paperwork, warranties, and more.
How to avoid it?
· Hire a real estate agent who knows the local market.
· Seek legal advice to review contracts before signing.
If you take these recommendations into account, you are ready to buy your new home!
