5 Questions to Ask Before Buying a Home - NYCM Insurance Blog

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Jun 23, 2021

5 Questions to Ask Before Buying a Home

Purchasing a home is exciting. From choosing paint colors to finding the perfect corner for your favorite chair -  it is a refreshing time to say the least. However, cosmetics aside, there are some important questions you’ll want to answer before even beginning the process. Continue reading below for five important questions to answer before buying a home.

1.  Are My Finances in Check?

Your financial situation is likely the number one factor when determining if now is the time to buy a home. Crunching the numbers between what your income is compared to what your monthly expenses are will help you figure out what you can  afford.


Not only should you have a steady and reliable income, but you should have savings, both for a down payment and for a  rainy day fund. Home ownership comes with unknowns; water heaters and furnaces can break, your roof might leak, and you will need that cash to help pay for these situations should they arise. Contrary to renting where your landlord is likely responsible for things that go wrong, making sure you are financially comfortable is important when buying a home to make sure you have the means to make repairs along the way.


2.  Is my Credit Score Adequate?

Similar to having your finances in check, your credit score will likely determine to lenders if you have a good payment history, or a payment history at all. Maybe you’ve never had a credit card or bills in your name, these things matter to a lender when looking into your payment history. Something as simple as having a household water bill in your name can help to build your credit. Making sure your credit is in good standing will also help you to get the best interest rate possible for a mortgage should you determine it’s the right time to buy a home.


3.  Am I Staying Here Long Term?

While for some it may be ideal to have your money going toward your own investment monthly, for others it may not make sense depending on their long-term goals. Asking yourself if you are planning to live in a location for more than a few years will help you both financially and stress-wise. Buying and selling a home is time consuming, and some lenders can even restrict against giving a mortgage for a property that was already sold within the last six months.


Another reason to consider the length of time you want to stay in a location is the housing market at the time of your purchase and sale. Giving yourself the buffer to wait for the housing market to be in your favor can help you financially down the road.


4.  What Are Your Must Haves?

Narrowing down your “must haves” can help to determine if now is the right time to buy a home. Do you want acreage, a garage, and a large footprint? Maybe you’re more interested in condo living for added amenities? Writing down your must-haves and comparing those to your budget can help to determine if now is the time to buy or if you should save for a longer period to satisfy your list.


5.  How Do I Protect My Investment?

Perhaps one of the most important facets of making an investment like buying a home is how you are going to protect it and the things inside. Homeowners insurance is required if you have a mortgage on your home, but should be considered regardless, to make sure you are covered should anything happen. Knowing you’re covered if a storm damages your home or if someone is injured on your property can make the difference between an insurance claim and serious financial implications. Pro tip: you might even be able to save money by bundling your home and auto insurance policies together!


Should you decide now is the time, and you find the right home, it’s important to sit down with an insurance agent to discuss the property and get an adequate quote for the home. If now isn’t the time to buy, an agent can also help you with finding a renters insurance policy to cover you in the meantime! To find a local insurance agent near you, click the button below!