5 Misconceptions Home Buyers Have
Home buying, one of the biggest investments we make, requires a lot of planning, research, and analysis. Understanding that many of us are first time home buyers, there can be a few uncertainties and misconceptions we could have regarding the entire home buying process. Of the many misconceptions and myths, MakaanIQ lists five common myths every homebuyer has:
The home buyers are of the view that buying a home requires a huge sum of money for down payment; hence, at times, they keep delaying their home buying decision. Most of them do not know that in India, the general common percentage share of the down payment is 20 per cent of the total price of the property. On the other hand, another misconception associated is that all they need is the amount that would be required to make the down payment. However, there are many additional costs that a home buyer incurs along with the down payment. These include loan application fees, insurance, taxes, registration charges etc.
Most home buyers believe that only a high credit score could make them eligible for a home loan. But, you could also be eligible for a home loan even with a low CIBIL score. There are many other parameters that banks and financial institutions consider to approve a home loan. An applicant's current financial position and his financial prospects in future along with family income or co-applicant's income are few such considerations which could matter in a home loan approval.
Real estate agent
Many home buyers do not feel the need to hire a real estate agent. No doubt, home buying is a buyer-seller agreement, but a real estate agent also plays a key role in the process. An agent has a thorough knowledge about the market and can help the buyer in the whole process including documentation, home loan and even negotiation. There are many renowned real estate advisors in the market, PropTiger.com being one of them, which gives complete assistance during the entire home buying process.
Right time for home purchase
There is no right or wrong time for buying a home. A fall in home loan interest rate is the apt time for home buying, is only a misconception. Home buying is a time-consuming process that could take months or even an year. Moreover, a decrease in interest rate could not be the only factor to go for a home loan. Affordability, financial position and eligibility to pay-off home loan are the prime factors which a homebuyer must consider before deciding the right time for a home purchase.
Future value of the home
A common misconception homebuyers have is that the price of property will surely increase in future. It has to be understood that the construction techniques, architectural designs and building guidelines keep changing with time. Also, the value of a home depends on several factors such as features, location and facilities. Market research and price trends should be thoroughly considered before planning a home purchase, especially in such cases, with a motive of future investment prospects.