Buying a property has its complications and hurdles, but owning a home has many advantages and benefits. In many people’s lives, buying a property is the biggest investment they will ever make, and one that may grow over time, depending on whether one did his/her homework properly.
Today we will start with a process that will help prepare you to be on a journey to be a homeowner. Some potential buyers can buy a property for cash, but the majority of potential buyers are not in that fortunate financial position, and therefore have to borrow funds from a financial institution. The financial institutions have credit processes to assess whether the potential buyer has the ability to repay the loan to be advanced.
1.GET YOURSELF CREDIT WORTHY
The financial institutions use to two credit principles to assess a potential buyer:
•Credit history: how have you conducted your accounts that you currently have or previously had. It is important to make regular payments without fail and before the specified date. This will impact your credit score positively, but if you skip instalments, you are jeopardising your credit score and limit your credit access at the financial institutions. It is therefore important to check your credit score, and you are allowed a free credit check once a year. This will give you a chance to fix your credit score before buying a property. Umthombo will assist you in need, if you are not sure on the process.
•Affordability: this will check whether you are able to repay/afford the loan. It is therefore important to do a budget and see how much you are left with at the end of the day, to see if you will be able to pay for the house you are buying. This will assist you to have an idea of what price range of the house can you afford. Umthombo will be able to assist with a pre-approval process. You will then shop with confidence.
- AREA IS IMPORTANT
Once you have decided which area you are interested in, it is important to do the research on the area, also do your homework on the average prices of the area to avoid overpaying for the property you are interested in. if you overpay, you may battle to sell the property at a profit. Also, check the state of properties in the area. Invest in an area where the community take pride in their properties. In such an area, property prices tend to grow much faster.
Also check the following issues about the area:
•Transport to work and the cost. Expensive transport might impact on your affordability.
•Schools and shops
•Security
3.PROPERTY BEING PURCHASED
It is important to pay attention to the property you are being shown,
•Check for defects, especially structural cracks etc. The seller is also obliged to tell you about these defects, it is incumbent on you to do your checking to avoid future disputes.
•Where there are structural changes to the property or outside rooms, ask for approved plans from the seller. The problem will be yours later when the municipality demands to see approved plans.
4.OTHER PROPERTY RELATED COSTS
In addition to paying the purchase price, there are costs related to buying a house and ensure that you are covered. In some instances, the bank may include them, but not all of them and they become your responsibility.
•Bond registration costs (Bank may include)
•Transfer Costs (Bank may include)
•Rates and taxes, payable to municipality
•Water and electricity, payable to municipality/Body Corporate
•Levies payable to body corporate.
•Insurance for life and the property.
In closing:
Please make use of registered Estate Agents, be vigilant as there lots of imposters.
Should you need any assistance with regards to selling and buying a properties, don’t hesitate to contact us: Umthombo
Tel: 010 500 5381
E-Mail:
admin@umthombomo.co.za
Soweto Sunrise News
