The vast majority of people who are interested in buying a home are not going to be able to pay cash for the home. Even for those who can buy a home in cash, they often would rather take out a loan to avoid pulling money out of their investments where they would have to pay capital gains taxes.
Those who take out a loan to buy a home will apply for something called a mortgage.
Simply put, a mortgage is a loan that someone uses to buy a home. Mortgages are very specific to the real estate industry; however, they are similar to other loans. People borrow money to cover the difference between the down payment and the cost of the house.
Then, they pay back the loan over a specified period of time with interest. For those who are buying a home, it is important to understand the basics of a mortgage.
Qualifying For A Mortgage
First, anyone buying a home has to qualify for a mortgage. Most lenders will have a set of criteria they use to approve someone for a loan. Some of the factors include:
The lender is taking on risk by providing a mortgage to someone. They want to make sure the borrower is going to reliably pay the loan back.
The Terms Of The Mortgage
Once someone has been approved for a loan, they need to figure out what the terms of the mortgage will be. Some of the variables include:
It is critical for everyone to talk with an experienced professional to make sure they understand the terms of the mortgage.
When you are a first-time homeowner, learning about your property can feel overwhelming. There are a number of systems in your home that require routine maintenance. Knowing when to have system serviced will help keep your home running smoothly. From the plumbing in your home, to the heating and cooling, understand that each system may need routine maintenance from time to time.
Your Heating And Cooling System
To maintain comfortable air temperatures in your home, it’s important to keep your heating and cooling system up-to-date. If you have a whole home system, it should be serviced once before the heating season and once before the cooling season. When you get filters changed, and your system serviced, you are less likely to have to deal with emergency repairs. In addition, your HVAC system will run more efficiently.
When You Have A Septic System
Waste water leaves your home either through the town sewer system or through a septic tank. If you have a septic system on your property, you need to have the system serviced every other year. Check the records of your septic system to see when it was serviced previously.
Address Plumbing Issues
A leaky faucet is a localized problem, while discovering that all of the drains in your home are draining slowly is systemic. You need to repair small leaks to avoid wasting water in your home, while systemic problems must be addressed by a professional. If your drains aren't working correctly, you may have a block in your main sewer line. Know where the main shut off valve is for the water coming in to your home in case of an emergency.
Electrical Needs In Your Home
Your home has an intricate electrical system that is controlled by an electrical panel usually located in your basement. When a circuit trips, you will need to reset the circuit breaker. If your home consistently has problems with a specific circuit, you'll want to have the circuit checked by an electrician to see if it is overloaded.
It's exciting to own a home for the first time. Once you understand the various systems in your home, it becomes easier to take care of your property. With good maintenance, you can help avoid emergency repairs to your home. Your heating and cooling will be more efficient, and you won't run in to problems with your septic system if you have one. If there is something you don't understand in your home, call a professional to get the problem looked at.
