Common Mistakes to Avoid When Buying Your First Home

It is no secret that Indians dream of owning their own home. And with increasing disposal incomes, favourable government policies and great home loan options, these dreams are turning into a reality for a large number of people. In fact, while in 1961, 61% of the people in India lived in rented houses, the number dropped to just 28% in 2017, according to the 2017-2018 Economy Survey.

If you too are considering buying your own home, then congratulations. But buying a house is one of the biggest decisions of one’s life. Make sure you use a home loan calculator to check for your eligibility and installments for repayment before proceeding with a final decision. However, there also are plenty of things that can go wrong, especially for first time home buyers. Here are some of the common mistakes to avoid.

Home loans have made buying a house much simpler. But sufficient research must be done to get the right one. Some of the things to consider are:

In case of fixed home loans, the interest rate remains the same through the entire tenure of the loan. This is great for those who want a sense of certainty and a fixed repayment schedule. In floating home loans, the rate is dependent on market conditions. Their advantage is that the interest rate is generally lower.

It is advisable to take a home loan that can be repaid before you get into your 50s. At that stage of your life, you might have other major financial responsibilities, such as marriage or higher education of your children.

Although some banks allow this ratio to be as high as 60%, it is better to not let it go higher than 50%. This helps in convenient repayment.

A house loan calculator is a great tool to calculate home loan eligibility, tenure and EMIs.

Getting a house is not about the sale price. There are other expenses associated as well, such as closing costs, registration fees, real estate agent’s fees, homeowner’s association fee, maintenance cost and property taxes. Many first-time owners fail to include these costs. When all these are taken into account, the house can go over budget.

Having a reputed and qualified real estate agent can make your job of finding the perfect house so much easier. These agents have in-depth knowledge of the properties in their area and can help you get a house according to your specific requirements. Look for things like the agent’s experience and what kind of properties they specialize in.

When buying a property, it may look great from the outside. But the inside is where most of the problems appear. The things you must look for inside the property are:

• Missing roof tiles
• Rotten window frames
• Plumbing problems
• Dampness in the walls
• Faulty electricals

You can take the help of professionals if you are not confident of inspecting it yourself.

All of these are common mistakes but, there are solutions for each of them as well. For instance, a great tool to choose the right home loan is a home loan calculator, which can also help you find out eligibility as well as installments.