A Step-By-Step Guide for the Homebuyer

Buying a house is one of the biggest investments that you make in your lifetime—financially, emotionally and otherwise too. It requires you to spend most of your life’s savings and makes you put in a lot of effort in the planning of every little aspect. So it’s important to keep in mind a few points when you are purchasing a home for the first time. To get more clarity on the process, here are some vital tips that can ensure you land a safe deal.

Location— the most important consideration for any homebuyer is the right location. No matter how lavish the apartment looks, or how appealing the price is, a good neighborhood is essential. Firstly, proximity to metro stations and bus stands should be considered. Secondly, basic amenities like schools, health care facilities, banks, recreation centers, local markets are important. If you are new to the area, get proper information of the locality and inquire about the safety, security and lifestyle of residents. Also, check police crime mapping websites for knowledge about the crime rate in the locality. Finally, if you are buying the property for investment purpose, learn about the real estate trends of the locality.

Budget and Finance—in most cases, either the buyers simply don’t have immediately available funds or cannot afford to dole out a large chunk of money from their life-long savings. Therefore, they depend on housing loans from banks. The procedure to obtain loan from various banks has been simplified to a large extent, however you still need to furnish a large number of documents for the final paperwork. Your income plays a major role here, as the amount of loan you can acquire is directly depended on your income. For a single income family, your monthly EMI should not stretch beyond 40% of your monthly take-home amount. Also banks only provide home loan up to 80% of the property cost. 20% of the property cost has to be paid by you through your savings. Typically, a home loan stretches over a period of 15-20 years and the repayment takes place on a monthly basis. So be sure to pick a comfortable monthly installment or EMI, without upsetting your overall budget.

Once that is done, analyze the different payment plans like construction linked plan, down payment plan, flexi payment plan, possession linked plan, no Pre-EMI plan, possession linked plan etc. that are available in the market to understand regular cash outflows you will have to bear.

When chalking out the budget for the house, do not make the mistake of stopping at home loan EMI. You will have to account for other costs such as registration cost, legal cost, service tax, TDS, maintenance, interiors which are typically not covered in home loans.

Type and Size of the residence—a lot depends on the size of your family and its exclusive requirements. The different types of residence include apartments, bungalows, duplexes, row houses, villas, pent houses and the size of a property depends on preferences such as number of rooms, bathrooms, balconies and more. It’s also important to keep in mind your future planning and whether the space will sufficiently meet your potential requirements or not.

Choose your builder carefully and seek expert counsel— half of your job is done when you finalize the location, your budget and the type of the house you want to buy. Next exercise is a background check of the builder you have in mind, especially if you are thinking of investing in a pre-launch project. Before committing your money, you should research thoroughly in online portals like proptiger.com which contains information of builder, their past projects, current ongoing projects and feedback of earlier buyers. Websites like PropTiger.com not only provides information but also are professional agents who will assist in any kind of paperwork with the bank as well as the builder. A reliable agent will always help negotiate prices with the sellers and will stay with you throughout the home buying process. He will take you to the best possible localities and search for houses within the ambit of your requirements. Also, you can take the help of online property portals to check details about the various projects,
compare their prices and gather information about the localities.

Insist on seeing a sample flat for reference and visit the actual site to understand the status as well as other locational benefits of the project. Most importantly, even though there might not be any visible defects, you must always check the fittings and furnishings used. Branded fittings last longer and have better guarantees than local fittings.

If you are planning to invest in a resale apartment, be extra cautious and do some in-depth research. For instance the apartment might have some seepage issues, may require some repair works in the kitchen or bathrooms, etc.

Once you’ve decided what to buy, you can then negotiate the price with the dealer and ask for some discounts. Remember, your agent can certainly help you in negotiating the best deal.

Inspect the home and papers—As far as the documents are concerned, you need to ensure that the following documents are provided by the builder:

1. Sale deed
2. Title deed
3. Building Plan Approval
4. Commencement Certificate
5. Encumbrance Certificate
6. Power of Attorney
7. Completion Certificate
8. Possession Certificate

Sign the deal— last but not the least, check the payment details and get all the paper work done. It is only after verifying all the details, possession date and other important documents, that you can finally seal the deal. 

Remember, the more you educate yourself and know about the home buying nuances, the less stressful the process will be. Do you think there are other important tips to follow when buying a home? Let us know by commenting below.