Buying a House, and Affording It

There are key things you need to look at before buying a house. I am going to discuss them in this article. First you need to truly understand that buying a house is one of the largest forms of debt you can acquire, so you need to make sure that buying a house is for you. Once you have made this decision, it is a big commitment and responsibility, so with that you need to make sure the following steps are taken before purchasing a home:



You need to plan a budget. This means adding up your annual income and deducting the every day bills you have. From this you will see what you can afford and what you can’t afford. Make sure to add the amount of the mortgage you are looking for and add insurance and taxes. It is better to add everything to your mortgage, this way at the end of the year you are not worried about paying a big lump sum for the taxes. If you do not know how much taxes will be for your home, there are many websites that will help guide you through the steps. If you can’t find the correct information you need, you can always ask your bank for an estimate of what the taxes would be on the price of the house you are looking at. Also, be aware of the neighborhood you move into, as the taxes for an identical house in a great location with be significantly higher than in a less-than-ideal neighborhood.

Realtor that Works

Find a Realtor that understands your needs and wants. Some realtors will try to push a more expensive house on you to up their commission, with little to no regard about your personal situation. If they put those stars in your eyes with a certain property that is more than your budget can really handle, you may overspend. Work with what you can truly afford, and remember saving money can help you add the things you want later down the road. If you don’t know a good realtor, ask around. You may know someone that knows a good realtor that will be willing to work with your budget and keep your best interest at heart.

Interest Rates

Contact a few banks and find which has the lowest interest rates. Once you find the bank you like, ask them to pre-approve you for the amount of a house you already know you can afford. Do not get pre-approved for what your credit will allow you to get approved for. This is how many people have fallen into a house they cannot afford. Only get pre-approved for what you can afford.

Home Improvement

If you are looking at a house that needs improvement, you need to take that budget into consideration, as well. Either ask for a lower price on the house to fix up the things that need to be fixed or see if you can find a way to save each month and do a project at a time. If this is going to cause you to struggle, finding a home that does not need that many repairs will be a better fit for you.


Have you applied for a personal loan? Did you utilize any of these tips? Comment below and share your experiences.

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