You want to become a homeowner, or you may know someone who does. How do you start?
Some of us think of homeownership as a maze that involves life-changing decisions, but no one has shared the roadmap with us. So we can more than imagine, in these pandemic times, how homeownership has taken on a whole new meaning for you. Truthfully, homeownership is where your life’s story begins. Therefore, for us, your homeownership journey can definitely start here. In this month’s installment we will show you how the pandemic and solid expert advice can help put homeownership within your financial reach within two years.
Get H.O.M.E.S.M.A.R.T. with these 9 Insider Tips!
H – Hone in on your monthly expenses because you will need to start saving early. The pandemic has provided an opportunity to hit the reset button on our spending habits, so you have had time to practice living on a budget. Take advantage of your lifestyle changes i.e. the cutting out of most of the extras, and put them to work for you. Making smarter choices and limiting your spending in areas where you can slim down will make a big difference in your savings. Check out our blog 5 Money-Saving Tips for COVID-19 and Beyond for some more ideas.
O – Organise your finances. Start thinking of and saving towards some of the costs and fees involved in homeownership, for example, your down-payment. You may need to put something aside, so automate monthly transfers to your savings. Any extra bonus or tax refunds, redirect it to your savings. Having a bigger stash can be a huge help when you buy your home! Read our 20 Ways to Save Money in Your 20’s for some helpful tips on saving.
M – Manage and strengthen your overall credit. Apart from having the down-payment, lenders look at your age, your income, your debt-to-income ratio and credit history. Make sure to stay on top of your existing and/or previous forms of financing and payments such as loans, car loans, hire purchase and credit cards. If circumstances have changed, have a conversation with creditors around more affordable payment options.
E – Examine and figure out how much ‘house’ you can comfortably afford. Start the process by determining how much you actually can afford to borrow safely. Use our online mortgage calculatorto get an estimate of how much your monthly mortgage payment could be, as well as, to give you an idea of how much you could qualify for based on your income, age and debt. Learn more about our prequalification process here: How to Pre-qualify; or book an appointment here: Book a Prequalification Appointment
S – Survey the property market carefully for homes within your budget. Make sure that your needs and expectations are both met when weighing your options. You can consider getting a starter home that meets your current needs, or a fixer-upper that you can customize. Sign up for our property alerts here to know when a new list is posted: Property Alerts – Sign up
M – Measure the differences in the loan options available to you and what they mean. “Low introductory rates” may not necessarily be advisable. When shopping for a mortgage, find out if it has a fixed or variable rate.TTMF is known for the stability of our interest rates. Our rates do not vary based on market conditions, so our customers are never caught off-guard by unplanned increases in their mortgage balances.
A – Ask the right questions. This is very important to do before you decide on entering into a mortgage. In What to Ask Before Taking a Mortgage we shared examples of some important questions you should ask when reviewing your mortgage options, for example, the interest rate (whether fixed or variable), any upfront costs and the ability to make additional payments.
R – Research First-time homeowner mortgage programmes. There is a variety of mortgages available with varying down payment and eligibility requirements. Make sure to compare mortgage rates and fees. With us at TTMF, you can borrow up to 100% of the purchase price or the value of the property (whichever one is lower) and agree to repay the amount borrowed plus interest over a specified time in the future, if you fall within the required salary bracket. Check out our 2% Mortgage Programme
T – Think about buying land now and building your home later as another option. It’s a smart move. As an appreciable asset, its value will increase over time. So, you can buy it upfront and as you allow time to pass, you can be saving up to build your home. If you haven’t yet had a chance, take in our ‘Buying Land” episode of the Home Smart web series for more insights.
As we explored in our To Rent or Own HomeSmart blog, and How your Home can Help You, homeownership can help you achieve other life goals. It is a great way to build generational wealth; and ultimately is an investment in your future. By understanding what it takes, you are now closer to making your homeownership dream a reality.
We’re Here to Help
If you are interested in exploring our options you can set up an appointment to speak with a knowledgeable TTMF representative. Find out more about how we can help you.
Whether planning on purchasing a home soon, or you’re thinking of building in the near future, we can help you figure out your homeownership costs. Our mortgage calculator is easy to use and a great place to get started!
If you are a couple, check out our Marriage & Mortgageblog, offering you 5 tips for mapping out your homeownership journey together
Keeping you Home Smart
We hope these tips give you a jumpstart towards your goal of becoming a homeowner, while you also pursue all of your personal, financial and family goals too! Subscribe to our blog as we continue to share useful information that keeps you Home Smart!
For most of us, taxes can be an inconvenient truth. Property tax is money that must be paid to the government for the home that you own. The amount you pay is calculated by the government and based on the overall value of your home.