Mistakes that first-time buyers should avoid
Category News
Perhaps stepping onto the property ladder is one of your goals for 2021, or maybe you're hoping to make the most of South Africa's lowest interest rate since the 1970s. Whatever your reason for deciding to invest in property, the decision you have made could not be a better one. A home is far more than a roof over your head - it can also be a solid investment. When it comes to buying property, there's a lot to understand, and there are a number of mistakes that you need to be sure to avoid.
Mistake 1: Not being aware of all the costs of buying and owning a home
When you rent property, you make monthly payments to your landlord, as well as typically paying for the water and electricity that you use. Once you have invested in a property, however, you will be liable for other expenses such as rates and levies - although levies are only payable if your home forms part of a sectional title scheme. Depending on where you buy, you may also become part of a homeowners' association, which also has costs attached to it.
Once you have signed the offer to purchase, there are costs involved with having the property transferred into your name. If you are buying property for over a certain price threshold (currently R1 000 000) you will need to pay transfer duties. Over and above this, there will be bond registration costs to consider. If you have been granted a 100% home loan by the banks, these costs will not be covered by your home loan. With that said, once you start paying off a home loan, you are on a journey to owning a significant asset.
Mistake 2: Not using a bond originator
Using a bond originator in your home loan application process is one of the biggest favours you can do yourself. Rather than having to face the endless paperwork of making an application to all the banks, you simply submit one set of paper to the bond originator, and allow them to do the rest of the work for you. This service is free, and the bond originator will leverage their relationship with the banks to help you get your home loan approved and to get the best possible deal. Using a bond originator means less paperwork, less hassle and a greater chance of getting the home loan deal that's right for you.
Mistake 3: Not ensuring a clear understanding of all the terms in the contract
An offer-to-purchase is a binding legal document, and once you've signed it, you are obligated to purchase that property and to adhere to all the terms contained in the contract. There will be penalties imposed if you fail to meet any of these obligations, many of which come with specific timeframes. The good news is that if you are working with a Jawitz #RealPartner, he or she will make a point of running through these contracts line by line to ensure that even if you are a first-time buyer, you have a thorough understanding of what you are signing.
Mistake 4: Not getting preapproved for a bond
Getting preapproved for a bond is one of the best things you can do before you start house hunting. By taking your personal financial affairs and credit score into consideration, Ooba can give you a clear indication of what you can afford. This can spare you disappointment and heartache during the home-hunting process.
Having a Jawitz #RealPartner guide you through the process of finding and buying your home is the most sure-fire way to avoid making any mistakes on your journey to homeownership. Contact us today for more information.
Author: Jawitz Properties
