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Since one's house, is, the single, biggest, financial asset, for the vast majority of people, doesn't it make sense, for potential homeowners, to consider, recognize, and evaluate, some of the relevant financial considerations? Obviously, a potential flat owner should have a professional look at and evaluate, his creditworthiness, and what adjustments, and/ or steps, should be made, prior to pursuing their house. This article will attempt to briefly examine, consider, and discuss, 5 financial considerations, qualified, potential home buyers, should seriously look at, because their future enjoyment, of the home, of their dreams, might be impacted, by some of these factors.

 

1. Down - payment

Depending on many factors, the percentage needed, for a down - payment, in order to secure a mortgage, may vary. We generally consider the conventional amount to be 20%, which means, if the mortgage, being secured, is, for example, $500,000, they will need to put down, $100,000. Remember, the more the down - payment, generally, the better the interest rate/ terms, and vice versa. In addition, what one must pay, every month, is based on how much, is being borrowed, and, therefore, one should consider his personal comfort zone!

 

2. Other, initial out - of - pocket monies, needed

When one closes on an apartment, there are many closing costs, the new homeowner, will experience. One is reimbursing the existing owner, for the remaining amount of oil, the amount of prepaid taxes (including real estate taxes, etc). Another is the escrow payment, lending institutions generally require, which includes prepayment for items, such as, generally, approximately, 6 months, real estate taxes, insurance, etc. Don't forget, your attorney fees, title fee, title insurance, etc.

 

3. Mortgage payment - related

Remember, your monthly mortgage payment will include principal, interest, and escrow (including taxes and fees, insurance, etc). A future apartment owner must examine, what monthly amount will he feel comfortable with, not only what he qualifies for. 

 

4. Other monthly costs

Besides your mortgage - associated monthly costs, there will be other recurring expenses. Your utility bills will include heating, electric, a reserve for maintenance and repairs, etc. Be prepared!

 

5. Emergency/ contingency/ reserves

The best way to prepare for unforeseen challenges, is to commit, every month, to pay into, a reserve fund (separate account), which you accumulate, yo prepare for contingencies. These include emergencies, shortages, contingencies, repairs, and renovations, as well as the necessary, planned maintenance and upkeep!

 

Will you prepare for future financial considerations, related to apartment ownership? Are you up to that commitment?

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