Buying a home is an exciting moment in anyone’s lifetime, and this is especially true if it’s your first time purchasing a home. That being said, there are a lot of ins and outs to the home buying process, and it can be easy to get overwhelmed.
Even with mortgage interest rates at an all-time low, it might not be the right time for you to make a new home purchase if you aren’t financially ready. Of course, everyone’s financial situation is different—it’s just important not to jump on the bandwagon just because of interest rates alone. If you do feel like you’re ready to take the plunge, the following six tips are sure to help you get a great deal on a home you’ll love for many years to come.
Get Transparent Data About Your Property
One of the first things you want to know when sizing up any property is whether it’s actually being listed at fair market value. There are certainly some times where you’d be willing to be more than the asking price (or a higher asking price for the neighborhood), but generally speaking, if you don’t have that kind of information you’ll likely be stuck second-guessing yourself.
Particularly if you’re buying in 2020 or 2021 during the aftershocks of a continuing pandemic, having a smart price for the listing you’re looking at is crucial. This is where a tool like Nalula smart price can come in. Nalula’s website offers homebuyers pivotal information about market conditions and which properties are underpriced or overpriced so that you can make a data-driven home purchase. Buying a home is likely the most expensive purchase you’ll ever make, and it’s important that you get your money’s worth when you do buy. Thankfully, resources like Nalula that combine unique filters and scores on how motivated sellers are to move their property make the decision easier than ever.
Work With a Real Estate Agent
Navigating the homebuying process can be difficult for first-time buyers. That’s why it’s crucial to work with a real estate agent when you’re looking for a new home. Real estate agents have seen it all and will be able to show you great properties and help you get taken seriously despite how new you are to the idea of homeownership.
Put Down a 20 Percent Down Payment
Even though you might be able to qualify for an FHA loan with as little as 3 percent down for a down payment, generally speaking, it makes more sense to put down 20 percent whenever possible. This is because anything under a 20 percent downpayment means that you’ll also be paying something called Private Mortgage Interest, or PMI. While PMI isn’t particularly costly, it means that you’re going to overpay on a property with money that doesn’t build your equity.
Keep Your Finances Stabrele Until You Close
Especially in a housing market as tumultuous as today’s it’s important to keep your mortgage application airtight until you close. Lenders are being even more insistent on qualification criteria in order to issue mortgages, often requiring larger down payments and running extra credit checks or even verifying employment the day before closing. The last thing you want to have happen to you is to lose a home you’ve made an offer on just because you put $3,000 of furniture on your credit card.
Have a Contingency Budget for Emergencies
If you’re only used to renting, you likely aren’t used to having to fund the costs of plumbers or electricians yourself since your landlord covered these sorts of expenses. However, when you own the home, you’re responsible for things like a new water heater installation if something happens to your old boiler. That also includes searching for and finding a reliable company to service your water heater, so it helps to reach out to a reputable company ahead of your home purchase just to find out how much their services cost on average. Having this information can help you create a useful contingency budget.
This is one of the most simple tips on this list but also one of the most important! Don’t settle for a home or condo that fits your price range but doesn’t bring you joy! A house is an incredibly large expense and you don’t want to regret your purchase for the next few years just because you weren’t patient.