All our advice for your real estate purchase
You wish to buy a property? The real estate research can be tedious and time-consuming. It is better to prepare yourself well, from the precise definition of the purchase budget, to the visits until the move in. Here are all the stages of a real estate purchase and our good advices to concretize it under the best conditions.
Define your real estate purchase budget
The first step once the decision to buy is to clearly define your purchase budget, and there are a number of parameters that need to be taken into account, including your borrowing capacity and your contribution.
Making a personal contribution
We often hear about the personal contribution when buying a property. It is a sum of money, usually from the borrower’s savings, which will be included in the mortgage loan package. The personal contribution is often a sine qua non condition for obtaining a mortgage loan. It is usually a contribution of 10% of the amount of the transaction, enough to pay the acquisition costs (notary fees, taxes, etc.). The higher your personal contribution, the better the conditions of the banks.
Calculate your debt ratio
In addition to the personal contribution, you will have to calculate your borrowing capacity according to your debt ratio, which is the rule of 33% of your income. The bank will also check your professional stability before making you a loan offer. To convince them to finance you, you will have to present a permanent work contract or demonstrate your stability with the same activity for at least two years.
Comparing banks will allow you to get the best rate for your loan. A better rate means a lower total cost of the loan, lower monthly payments or a larger loan. However, you will need to check the APR to compare the banks’ offers. This rate takes into account the borrower’s insurance, which is compulsory for a mortgage, as well as the costs associated with the loan. If you pay for your property purchase “cash”, these steps will obviously not be necessary.
Find the property
To find the property of your dreams, it is better to be very reactive and to refine your criteria as you visit. The good advice is to subscribe to the alerts of real estate sites and to register your search with real estate agents.
It is best to prepare your visits with a list of questions: on the amount of charges, on the type of heating, on the work to be done, on the amount of local taxes, etc..
Making an Offer to Purchase
If the property is suitable for you and you are ready to make an offer to purchase, do not hesitate to use our offer to purchase template. At this point, you can of course make an offer to purchase at the price or negotiate the amount with the seller or estate agent.