Buying a house is exciting and life-changing. Saving for the deposit that you place when you come to take a loan is important. Remember, the more money you put down upfront, the less you will borrow, and the lower is the amount of interest you will pay on your loan.
In reaching a decision on the investment of your home is realistic. Keep in mind that in buying your home you will not only pay the actual capital, but the monthly mortgage and the interest that you will accrue on that mortgage.
You must make sure that the monthly mortgage is such that you can afford it and that it does not squeeze your disposable income that will make managing your monthly budget and the mortgage payment difficult to keep up with.
Ask yourself: in the event of an extra-ordinary circumstance such as the birth of a child that is unplanned, major renovations to your home, or potential loss of employment would you still be able to afford to pay at the mortgage and manage your monthly financial budget.
Keep in mind that apart from saving for a deposit you will incur other expenses in the process of buying your home. Such other associated expenses include:
- Fees to a notary to carry out research on the property.
- An insurance on your new property and furnishings.
- A personal life insurance to cover your loan in the event of your passing away.
- Bank’s fees and charges for the provision of your loan.
In seeking a loan for your house – shop around. Different banks will offer different schemes. They are in competition so make sure you identify one that meets best your financial envelope, that gives you ‘safe harbour’ that allows you to re-plan your monthly mortgage payments in the event of the unexpected, etc.
If you are a first time buyer make sure that you obtain the necessary information on assistance schemes that the government may issue from time to time to encourage home ownership.
Make use of on-line calculators that Banks provide when you are planning the purchase of your house.