Practical and Helpful Tips: Businesses

Buying a Home for the First Time

Buying a home could be the biggest single purchase you can ever make, so it’s important to be familiar with the numbers before signing any contract.If you’re ready to take the plunge and have your very first home, these are seven tips for you to consider:

Your Budget

This could sound elementary, but underestimating the actual costs of ownership is a typical mistake.Not only will you have to pay a mortgage, but you’ll need to settle taxes, insurance premiums, and other expenses associated with with owning a home.These days, a down payment is about 20% of the purchase price.
Doing Professionals The Right Way

Your Credit Score
The Beginner’s Guide to Professionals

Your credit score plays a crucial part in getting low-interest financing.Go over your credit report and eliminate discrepancies before you face your lender.

Keeping It Small

Amassing new debt before home financing can have a bearing on your debt-to-income ratio and the amount of money you can borrow from a lender.Hence, don’t buy a car or any big-ticket item on credit if you have plans of buying a home in the near future.

Doing Your Homework

Save cash and time by shopping around–there are loads of websites that offer help with this– to find out which lenders are offering the lowest interest rates in your area.Comparison-shopping will help you save cash over the long term, and when you’re dealing with a 30-year mortgage, that long term can pretty long.

Emergency Savings

Many a dream home has become into a money pit, costing the owner more than intended.What if your plumbing breaks down or your street floods?Prior to the purchase, hire a well-reputed home inspector, and prepare for the unforeseen with money allocated for the unknown.

Energy Tax Credits

Qualifying energy-efficient equipment in your home can get you some useful energy tax credits.More than a third of solar and geothermal installation costs are claimable on your taxes, meaning you get to pocket some savings.

Renovations

Although you normally can’t subtract home improvements on your annual tax return, the good news is that these costs can come in handy if you ever decide to sell your home.Just include them in your adjusted cost basis: the bigger the basis, the lower your capital gain.To qualify as a deduction, the improvement must add to the material value of your home’s value, lengthen your home’s useful life substantially, or make your home useful in new ways.When calculating capital gains, you may as well exclude a maximum of $250,000 of the gain from the sale or, if you’re filing jointly, up to $500,000.

A home can help you build a future worth looking forward to, or break your bank.Know your numbers first, and then buy into the dream.