This guide is for those who want to buy a home soon.
Ready to check buying your first property off your bucket list? The goal may feel like a dream, but it is 100% possible. It just takes a little planning.
Here are 5 tips to make your process easier and more effective:
Plan your future with Platea and Popular
This article is presented by Popular. Learn more on its Mi Futuro page.
Start here1. Define the home you want for the future, not the one you want right now.
Apartment or house? Large or small? Yard or patio? These are some of the questions to ask when looking for your dream home as you picture yourself 5, 10 or 15 years from now.
Keep in mind the lifestyle you want and your long-term goals. Today you might love the idea of an apartment. But if you're planning a wedding, children and a playful puppy, you may prefer a house five years from now.
Buying a home is one of the biggest decisions a person can make in life. That's why it's important to think about the big picture.
2. Choose the best location for your home.
Similar to the previous tip, focus on both the long-term dream and your individual priorities.
Some considerations might be:
Do I want to be close to family?
Will I be sitting in traffic on the way to work?
Is my career limited to a specific area, or can it be practiced anywhere?
Do I want a quieter or busier place?
If I have children, are there schools nearby?
Are there hospitals nearby?
Also keep in mind that location can affect the property price and the type of mortgage loan.
If you want guidance on which mortgage loan1 you pre-qualify for, fill out the Popular Mortgage form. A specialist will help you start the process. Also, take advantage of this free calculator, where you can evaluate different interest rates and estimate your monthly payment. For more information you can visit 🏡 La ruta a tus sueños: popularMortgage.com.
3. Write down all the costs of buying a house.
With your ideal home and location in mind, you can estimate the price and prepare for it. Here are the most common costs when buying a house.
Down payment
The down payment, or aportación, is the first payment you make when buying a house and is calculated on the total price of the home. Depending on the type of mortgage loan and its terms, the down payment amount may vary or may not be required.
Closing costs
Closing costs include steps such as the appraisal, title search, related fees, etc. It is recommended to save between 3% and 6% of the home's price to cover all these expenses.
Moving costs
If you have friends with a pickup truck, give them a call to save on this expense. ✍️ Add to your budget the cost of transferring water and electricity to your name, and any other expense you'll need to cover to move into your new home.
Repairs and renovation
If you chose a house that needs work, get all the estimates to cover materials and labor.
4. Create a financial plan that works for you
Since this is one of the largest purchases, if not the largest, you can make in life, you need a solid budget, lower debt and savings.
Your debt
As a general rule, your debt should not exceed 30% of your income. Make all payments on time and, if possible, pay off your debts.
Your debt affects your credit score, and your credit score in turn affects the terms of your mortgage. If you want a larger loan at a lower interest rate, you generally need to keep your debt in check.
Your savings
Even if you qualify for benefits available for buying your home, there will always be costs to consider. It is recommended to save for the initial expenses and two months of mortgage payments.
Consider opening a savings account, such as U-Save de Popular2, to keep that money separate.
Your budget
You not only need to save for mortgage expenses; you also need a budget that includes the costs that come with maintaining a house.
These can include water, electricity, internet, access control, yard maintenance, condominium assessments, etc.
You should also consider possible unexpected events, such as a career change or a health issue. Life sometimes brings surprises, and your financial plan should include different budgets to reflect that.
5. Finally, take your time and consider your options. 🤞
There is no rule that determines when the right moment is to buy your home. Even more so when it is such an important decision.
Take the time to keep learning and looking for programs and incentives. When the moment comes, you will be able to buy the home you really want and live the life you dream of in it.
When you are ready to take that step, visit popularMortgage.com for help with this significant process.
This article is for informational purposes only and does not represent any endorsement, nor does it offer any guarantee of accuracy or applicability of its content for any particular purpose. Neither Popular nor any of its affiliates, subsidiaries or related companies are, or will be, responsible for any special, direct or indirect damages resulting from the information contained in this article. If you require any type of advice related to this article, you should seek it from the qualified professional of your choice.
1Equal Housing Lender. Product offered by Banco Popular de Puerto Rico. All offers are subject to credit approval. Certain restrictions apply. OCIF Lic. B-1. Popular Mortgage is a division of Banco Popular de PR.
2Member FDIC. Product offered by Banco Popular de Puerto Rico. Certain conditions apply. For more information, visit https://www.popular.com/cuentas-ahorros/usave/
This content was translated with the assistance of Artificial Intelligence (AI).
