When it comes to buying a new house, many of us push our finances as far as they can go; the larger your down payment, the less money you need to borrow. In some ways, it makes sense to pile as much money as you can into a new home. But in reality, there are a few reasons why you shouldn’t put every cent of your savings towards buying a home. Many people would even go as far as to say that you should keep a fair amount in the bank. That rule applies, even if it means taking out a larger mortgage.
But, why would you knowingly commit to a larger repayment plan if you have the money? Because buying a house you want is, of course, more than bricks and mortar. Moving is stressful enough, let alone doing so when you don’t have any money to help you. Emptying your account could prevent that new home from being the dream you imagine. And, we’re going to look at why.
You don’t know what you’ll uncover when you start to decorate
You move in and excitedly get the paintbrushes. But, within moments of starting you realize that there’s a damp patch so large no paint will cover it. Worse, you don’t have any money left to deal with it because you put it all towards the house; a rookie mistake and one you’re sure to regret. One way around this is to take time for a real estate inspection before you buy it. Doing so will give you a confirmable proof of the money you’ll need to set aside for maintenance. Even if you don’t take this step, keep some savings to get you through.
You won’t be able to make it your own
Even if your house is in tip-top condition, the chances are you’re going to want to do a complete redecoration once you get the keys. Even if the previous owner had decent taste, it doesn’t mean it’s your taste. You may struggle to feel at home with their designing. Sadly, decorating the whole house is no cheap task. Even if you kept it basic, you would need a few hundred behind you to stand any chance. And, guess what? You aren’t going to have that if you pile everything into buying the house itself. As a result, you may find yourself living for months with someone else’s decor ideas. It’ll hardly be the dream home you always wanted.
You’ll have to compromise on the furniture
You may even find that you’re unable to buy the furniture you want. Nothing completes that dream living room like the ideal chaise lounge. But, you don’t stand a chance of affording that if you don’t budget for it before making an offer. Instead, you would have to make do with hand-me-down for who knows how long. That’s no way to comfort, and that’s why you need to have money in the bank when you move.