Buying a new house is one of the most significant accomplishments adults can achieve. It is the place where you begin a family and live out the rest of your days in peace.
When buying a new home, you want to get the best deal possible and save some extra money on other things. That said, have a look down below at different ways to save money when buying a house.
Use an Experienced Real Estate Agent
If you make use of a good realtor it will save you a lot of time, money and heartbreak. A Real Estate Agent is a professional that has experience in the home buying process and contract expertise. If you want to get the best deal on a home and a smooth process further, hire a local realtor.
Many first time buyers want to try to save money by not using an agent, but the money saved will not be worth the extra trouble you’ll have to go through yourself.
Another positive thing when hiring a realtor is that they will negotiate various things in the buying contract, things that may have never heard of or don’t quite understand. Go the extra mile and get referrals of a good local real estate agent.
Get Loan Quotes
Interest rates are going to be different when it comes to mortgage lenders. It is recommended that you get loan quotes from a variety of mortgage companies so that you can get the best possible deal and save unnecessary money. Remember that lenders charge you for other fees as well.
This includes processing of a mortgage, original loan fee, loan application fees and other services. When you have a suitable mortgage company, use a loan calculator to figure out your monthly mortgage repayments and plan your monthly expenses well – this will help you to keep track of your finances and give you the opportunity so save some money.
Save 20% for the Down Payment
If you do not want to be stuck paying for mortgage insurance, save 20% for the down payment. A down payment is a percentage of the total price. For example; the down payment for a mortgage might be 5%.
It is usually cash that is at the buyer’s disposal and does not require any lending or borrowing. Mortgage insurance is insurance on the mortgage loan itself. If the borrower defaults on the loan, the lender is going to be reimbursed for all funds that are lost. FHA loans require you to have mortgage insurance regardless of the amount of your down payment.
Find a House that Needs Some TLC
If you want to save money when buying a home, consider buying a home that needs some love. A house with lots of upgrades and custom features will cost much more and it probably won’t sweep you off your feet.
It will take some extra time to search for that home that you can transform into a masterpiece, but it will be worth it. Painting walls, fixing lights and adding your personal touch will cost a lot less than buying a picture perfect house.
Increase Your Credit Score
The higher credit score you have the better interest rate you’ll receive. Lender fees and interest rates are directly connected to your credit rating. Do a few simple things to improve your credit score quickly before applying for a mortgage loan.
Consider paying down your credit card balances so that your balance is below 15% of your credit limits. Also, do not apply for a new loan because it will cause an initial drop for a couple of months. When you know that you are going to apply for a mortgage loan, hold off on buying that brand new car or getting another credit card.
Purchase in Winter
The right time of year also dictates the housing market. Spring and Summer months are when most consumers are in the market to purchase, so the costs of houses will also be a lot higher. Try to not give into your desires when you want to save money.
Hold on and wait for the winter to arrive and then make your purchase. According to experts, when you buy a home in the winter months, you can save up to 20 thousand dollars.
Buying a home should be a beautiful and memorable time in your life – use the resources at your disposal in order to have a seamless buy and find the house of your dreams!