SHOP AROUND FOR A MORTGAGE.
- Getting pre-approved for a mortgage is a must in today’s robust market.
- Obtain pre-approvals from at least three different lenders to compare terms such as interest rates, fees, closing costs and down payment requirements.
- Shopping around for a mortgage could save you hundreds each month.
AVOID COSTLY PRIVATE MORTGAGE INSURANCE (PMI).
- If your down payment is less than 20%, chances are you will be required to pay private mortgage insurance.
- PMI has no benefit to you, the buyer, as it only protects the lender if you default on your loan.
- Avoid high PMI by having a good credit score and try to put more money down if possible.
BUDGET FOR CLOSING COSTS AND ADDITIONAL EXPENSES.
- Besides the down payment, you will also have closing costs which can cost around 2-5% of the purchase price.
- Learn about the other often overlooked costs to home ownership in our blog The Hidden Costs About Buying a Home.
START EARLY.
- The real estate market generally picks up the pace in spring and summer, so it’s recommended to start early.
- Now is the time to get pre-approved for a mortgage, interview realtors, and narrow down your needs and wants in a home.
- As the real estate market gets busier so do contractors, appraisers, and lenders which may make it more difficult to book appointments and require greater flexibility.
HIRE YOUR OWN REALTOR®
- Hiring your own REALTOR® instead of contacting the listing agent will not cost you a penny, and their job is to represent you. The seller’s agent is legally bound to represent the seller’s interests, not yours.
- In most real estate transactions, the seller pays the full commission which is split between the listing agent and buyer’s agent.
- Have the expertise and experience of a buyer’s agent on your side.
- Your agent can explain and guide you through the entire buying process.
BE CAUTIOUS ABOUT BUYING A FIXER UPPER.
- If you’re a first-time home buyer especially, think twice before jumping into purchasing a fixer upper.
- Homeownership comes with a lot of responsibility.
- Adding major repairs into the mix can become costly, and overwhelming, especially if you plan to live there while you fix it up.
- Learning the ropes of homeownership first, can better prepare you for homes that need more work in the future.
NEGOTIATE REPAIRS AFTER YOUR HOME INSPECTION.
- If you found a home you love, in the location you wanted, put together a reasonable offer and include a home inspection contingency.
- Aim for an accepted offer first, then address issues of repairs after you have your home inspection.
- Since the inspection is a contingency, you will not be bound to the contract if you can’t come to an agreement with the Seller.
- Seller’s will often be more willing to negotiate after they accept an offer, in order to keep moving forward with the transaction instead of starting over with a new buyer.
DON’T SWITCH JOBS BEFORE CLOSING.
- If you’re taking out a mortgage for your home purchase, don’t switch jobs before closing on a home.
- Altering your employment could disrupt the loan you have lined up, and you could lose out on the home.
We hope this information is helpful to you. If you would like to speak to one of our realtors about the local market or about taking the next step to purchasing a home, please don’t hesitate to reach out to us.
Learn what other people have said about working with us on our Testimonials page.
