For the uninitiated, the home buying process may seem simple: a buyer merely chooses among properties that catch his or her interest, they then make the payment and move in. Arguably the biggest investment anyone can make, home buying is anything but simple, and of course it requires a significant amount of time and deliberation.
One misstep could lead to an extended and stressful acquisition process. It could even result in home buying not materializing at all. In this edition of Jumia House Q&A, we discuss why finding a housing loan first before looking for a home to buy can make the process a little less arduous.
What to Find First: A Home or a Housing Loan?
A common idea among first-time or inexperienced home-buyers is that they have to find their dream property before thinking about how much to borrow from a bank or financial institution. Unfortunately, starting home-buying without investigating the financial options first commonly leads to being disenchanted with the thought of acquiring a new home altogether.
Unless you are fortunate enough to have enough cash to pay for any home in full, most people need a home loan. If you find a home to buy now only to apply for a housing loan later, there is still the possibility of you not qualifying for the amount you need for the purchase, resulting in time wasted and disappointment, and not being able to close the deal and move in.
The Benefits of Finding a Housing Loan First
Real estate experts usually recommend starting the buying process by qualifying for a loan first. While attending property viewings or browsing real estate listings online is more enjoyable than sitting down with a loan advisor and exposing your financial situation, the home buying process will be made less stressful if you take care of your finances first, then window shop later. This way, you are more likely to make a sensible financial decision as opposed to an emotional one.
Understanding your loan qualifications allows you to be more realistic with the options you explore, helping you differentiate between what you need and what you want, and letting you bargain from a position of strength as you are house-hunting.
You may be deliberating between a small townhouse close to the central business district or a three-bedroom house that is further out but is slightly more affordable and provides more room. Ultimately, it is knowing how much you qualify for and its long-term financial implications that makes the difference between these choices.
Furthermore, knowing how much your monthly mortgage payments would be based on the loan amount you qualified for will allow you to better evaluate your overall finances during and after the buying process. Along with your monthly amortization, there are also taxes, maintenance expenses, and possible association fees to contend with, and understanding how much you can borrow and the additional costs associated with the property your income can afford lets you determine if you are indeed ready to finally purchase your own home.
About Jumia House Zimbabwe
Jumia House is the best online property marketplace that offers sellers, buyers, landlords and renters a secure and easy-to-use platform to find or list properties online. For feedback or more information visit house.jumia.co.zw or follow us on Facebook, Twitter: @JumiaHouseZW or email to service.house@jumia.co.zw or call 04 740940 or 08080181 (Toll Free from Econet lines)
