If you live or plan on moving to the UK, you have several choices as far as where you have a right to live. You have the right to buy a new home or rent until you are ready. When should you buy a house? Buying a home should be only done when you are financially able. Find out now when buying a home makes sense.
Are you ready to buy a home
The thrill of moving to a home is exciting. Moving to a house that you have saved for your whole life can be a dream move or it could be your worse mistake. You must know how to buy as well as when to buy. The economy is not in the best shape now and many sellers have had their homes on the market for months, if not years. Is buying a home in a bad area a good idea? Location Location should always be your main goal in house buying. If for some reason, you must sell your home again and the market is still bad, it is only those homes in the best areas that will sell fast and for the most money. When buying a home, also make sure to do a full home inspection to make sure that your home is as good of a buy, as your estate agent claims.
Calculating your readiness to buy a home
Loans for homes are at their all time low in interest rates right now (09.01.11). However, are you qualified? Many banks are turning down A+ buyers, so it only makes sense to look for a home in the low end of your qualification scale. Most banks allow a 28 to 36% qualifying ratio. This means that you take your net paycheck for the month, minus your taxes and deductions, and then minus out your monthly bills, such as credit cards and car payments. Take this figure and times it times 28% and that is what your low end qualifying ratio is. Although the banks allow a higher rate, be smart and buy a home that won't put you in the poor house later on. This amount must include PMI (Private Mortgage Insurance), taxes and insurance. You can go online and find a free mortgage calculator by doing a simple search for free mortgage calculators.
For sale by owners
Now that you know exactly what you qualify for, you can begin your search. If this is your first time buying a home, then buy with an estate agent who can guide you to the right home. Home buyers may be tempted to buy with a for sale by owner hoping for a great deal. However, buying without representation the first time should be avoided.