5 Easy Tips To Buying That Perfect Second Home
Many of us who have bought property have been faced with the age-old question that goes through every homeowner’s mind, ‘How to buy a second home?’ Investing in a second home is a big decision that can drastically change your future. Whatever your interests may be, there are certain things you need to look at in order to make this investment stress-free and worthwhile.
Here’s a list of steps you can follow to help you purchase your second home and a few tips to qualify for a second Home Loan.
Evaluate Your Finances
Take a close look at your finances when you decide to invest in a second property. Before you decide to dive headfirst into the property market again, ask yourself a few questions. Why are you buying a second home? Are you still paying instalments on your first home? All these will give you a fair idea about whether you should go ahead with this decision or not.
If you’re planning to approach this property purely as an investor, check how beneficial this will be in the long run. If your first Home Loan still hasn’t been cleared, make sure your savings and income are secure and you won’t end up in a financial rut after making a new investment.
Maximise Your Credibility
In order to make your transaction hassle-free, make sure you meet the requirements to qualify for a second Home Loan. Here’s a few tips on how you can secure a second Home Loan.
- The first thing to keep in mind is your credit score. To maintain a good credit score make sure all your bills are paid on time, all your credit reports are blemish-free, and none of your credit cards are maxed out.
- Keep all your documents in place and your bank statements ready. Once you have all these things in hand, you’re good to go and you can approach lenders for a Home Loan without any second thoughts.
- If you already have property on loan, try to pay off that debt before you borrow more money. This reduces the load on your savings and also gives you a better chance to have your loan approved.
Make The Right Moves
If you’ve managed to clear your second Home Loan eligibility criteria, all you need to do is take the right steps towards finding your dream home.
The property market can confuse even the best investors and it doesn’t hurt to approach a few real estate agents. Despite what people assume, they will almost always point you in the right direction. Consider a few important things before you set forth on your hunt –
- The location; check for proximity to work, ease of access to markets, rate of development in the area.
- The type of structure; whether it’s an apartment, a duplex, a villa, a row house, etc.
- The locality; how safe it is, if it is prone to flooding, if there roads with streetlamps, and the communities you will be surrounded by.
If you are investing in a second home, you would want it to be a better investment than your first home. Don’t let the standards drop with this purchase.
Pre-approval is a process which allows you to book your desired property before the bank loan is sanctioned. It works like this –
- Before searching for your property, you decide on a tentative loan amount and approach a bank that offers pre-approved Home Loans.
- They will do a thorough background check of your credentials and financial status and if it comes out clean, the bank will issue a pre-approval document which deems you eligible for a Home Loan.
This way half the required paperwork gets done as soon as you find a home, and all that is left is for the bank to sanction the final loan amount for your property.
Quickly Finalize Your Deal
Before you strike a deal and lay claim to your new home make sure you have everything sorted at your end. If you are pre-approved, you will have less paperwork to process and it becomes a fairly easy to finish your work.
Even if that isn’t the case, there are a host of online banking options available which simplify the process of applying for a Home Loan. To doubly secure your investment, get a proper inspection of the property done to rule out any damages or faults with the house. You should also start applying for insurance to protect yourself against any major problems that may arise in the future, particularly from natural hazards like earthquakes, floods, etc.
Now that you’ve successfully covered all these points, it shouldn’t be too hard to find and purchase a second home, and make sure your efforts were worth every rupee you spent.
NBFCs like Bajaj Finserv even let you set up an online account to keep a track of all your Home Loan payments for the entire loan duration.