One does not buy a home every day, and it takes much research to be able to make a good investment for beginners. For a first time home buyer, it is understandable that decision making can get difficult. People feel the pressure when spending a significant amount of money and usually tend not to explore other options because they haven’t tried them before. It is one of the biggest reasons that a first time home buyer often lets his bank accounts take the toll of massive spending all at once instead of going for home loans.
There are many myths around home loans which makes people doubtful of using them. Loan on a home might not sound like a good idea to you because of preconceived notions that you may have about it, but if you look at it in the long term, it is convenient. Through this post, we tell you why home loans make sense and why as a first time home buyer you should not be wary of going for one.
1. No Major Blow to Your Bank Balance
When you choose to pay for your new home in full, you are sure to spend a tremendous amount of money all at once. Doing this puts pressure on your bank account and it is not the best way to invest your earnings. Where you can use your money in mutual funds, you will be spending a significant sum on real-estate, which does not give you that great of returns for a long time. A wiser option to buy a home is to choose a loan for a new house and use the rest of your money in better investments without letting it get all swept in one go.
2. Plenty of Options
A person who is a first time home buyer often loathes the idea of looking for loans. The idea that searching for the right loans and applying for them takes much work may make you want to take a step back, but here is what you should know before doing so. Getting home loans is easy. There are many banks and financial services out there that lend money to all kinds of borrowers.
Applying for home loans takes only a few clicks on the internet where you get your credit score and compare hundreds of policies to choose what is right for you. Neither you have to lose a lot of your time nor do you have to take long rides back-and-forth between your bank and home. All you need to do to find the right loans is to log on to the web, and everything will be at your fingertips.
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3. Home Loan Insurance as a Cover
Generally, home loans are required to be paid within over fifteen years. These number of years do put less load on your bank account but what worries buyers is that who would pay these loans if something happens to them. No one wants to burden their family with debts after their departure and fifteen years is a long time which may bring who-knows-what.
To take care of this worry, home loan insurances are used as a cover for any mishaps that may occur in the period of loan settlement. Many financial services bundle home loans with insurance at great offers. With the help of these loan insurances, if the borrower loses his life or gets diagnosed with the life-threatening situations then the insurer pays for the rest of the loan amount which is yet to be cleared.
4. Better Budget, Better Home
Obvious isn’t it? When you lock-in your funds to pay off for your new house in one time then you restrict your budget. With home loans, you can not only increase the time for the payment but also improve your budget to get your dream home. Paying lesser money at regular frequencies will allow you to spend for a better home than what you may be settling for with your restricted budget. If you are investing in buying a home, then why not buy the one which you always dreamt of?
5. Benefits for a First Time Home Buyer
Are you a first time home buyer? If yes, then you can make use of various benefits that financial services and banks offer to you. Banks come with many attractive policies for the people buying a home for the first time, including a lower rate of interest on home loans. There are many benefits that the governments also offer with their banks for getting buyers to use their home loans. In countries like India, many government banks extend the regular loan settlement period from fifteen years to as much as twenty years for first time home buyers.
Also, when you’re first time purchasing a house, you’re careful about little things to ensure that your purchase doesn’t go wrong. If you believe in horoscopes, you should also check if it’s the right time to get a new home or not according to your horoscope.
So, doesn’t it make a lot more sense to rather go for a home loan, instead of paying for it at once? We hope that the information in this post will be valuable to you. Check out other useful content on our website for more posts like this.