Deciding to buy a home can be a difficult decision to make. The first steps are always the most daunting and that is why we prepared this Top 4 list of tips to help you make heads or tails of the infinitely confusing process that is home buying.
1. Starting your savings process early is your golden ticket
- Down payment:
You might not be surprised, but buying a home can get super expensive even if you don’t count the cost of the home itself. When taking into consideration the benefits of a large down payment, it becomes clear that starting to save early can save you a lot of headaches and extra costs when you actually own a home.
The down payment is your first step when it comes to your home-buying savings. The size of the down payment will determine how much a lender is willing to give you, some loan terms and conditions, and may even make you more competitive among other buyers. When in doubt, you can always find a convenient down payment calculator online and start planning your savings.
- Closing costs:
When it comes to your mortgage, there will definitely be some closing costs associated with buying a new home. These typically range from 3% to 5% of the loan you have taken. Asking the seller to pay a portion of the closing costs is always an option, however, keep in mind that sellers typically look more positively toward buyers that can cover all the expenses, making them more competitive.
2. Always consider how much you can afford
While starting to shop for a new home can be an exciting process, it is always wise to consider your options carefully when making such a big financial commitment. If you end up with a low down payment, you might find yourself cornered by extra fees when it comes to paying back your home loan, or have difficulty if the home requires some renovations.
Sure, you can’t see into the future, and that is why online tools like a home affordability calculator can help you get ahead of your plans and feel at ease to pick the best home.
3. Keep a close eye on your credit score
There are numerous tools online that can help you keep track of your credit score, and you can also get free copies of your credit score from the 3 main credit bureaus. Having a strong credit score will help you get qualified for a home loan more quickly and it will also affect the interest rate offered by lenders.
You can also improve your score by making sure that you pay all your bills on time and keeping your credit balances low. This essentially shows lenders that you are financially reliable and are a safe bet for a home loan.
4. Keep a close eye on your credit score
Buying a home is such a long and daunting process, that it can get very overwhelming, especially for first-time buyers. That is why you should always consider contacting real estate professionals that work in your area or the area you are interested in.
The right real estate professional will not only cover any knowledge gaps you might have about the process but also provide you with a selection of homes based on your preferences and market availability, take into consideration your financial situation, help with your negotiations with the seller, and always consider your needs first.
We hope these 4 tips will help you map out the way to your journey of buying a new home. Buying a home can sometimes seem like a walk in a dark forest when you don’t know the way. But just like taking up a new skill, consulting with a professional will light the way forward to an otherwise daunting experience.
