Reference no: EM133056263

It is often said that one of the largest investments we make in our lifetime is our home purchase. Given what you've learned from personal experience, from your readings, or from others' experiences, what advice would you give to someone about purchasing a new home? You can discuss practical matters, loan-related matters, etc.

For example, I once had someone tell me that it's important to change the locks on a new home, especially if it's new construction. This may sound counter-intuitive since nobody has lived there before, but as my friend explained, a new construction home has had many key copies made for the different subcontractors that have worked on the home. She spoke from experience. She came home to her under-construction home to find the two very large and very expensive front doors taken off the hinges and stolen. The perpetrator turned out to be someone that had a key to the home because they were doing plumbing work on it.

Another example (more to do with student loans) is that of a friend that refinanced her student loans only to find her principal balance never decreased after payments. She showed me her paperwork and it turned out she had refinanced with an interest-only loan. This was someone with a PhD, but without any knowledge of loans and their different structures. It's important to understand how loans work (particularly your mortgages) prior to signing on the dotted line.