TOP TIPS FOR BUYING A HOME

By
Real Estate Agent with Exit Realty Group

TOP TIPS FOR BUYING A HOME 

1.  Sell Your Home First

These days, it's more important than ever to sell your home before you commit to a new one. With a glut of properties on the market and tighter lending standards, it typically takes longer to find a buyer than it used to. If you don't start showing your home until after you've signed a contract for a new place, you risk carrying two mortgages for an extended period of time. This is a top tip for buying a home.
 
Also keep in mind, the most accurate way to know how much home you can afford is to see how much someone else will pay for yours. If you've overpriced it, you'll know after the first few weeks it's on the market. Once you have an idea of how much your home is worth, you can set a budget for a new home.

2. Know Your Credit Score

As soon as you decide to move, get a copy of your credit report. About 80 percent have some sort of mistake, 25 percent of which can be serious enough to drag down your credit score. That could hurt your chances of getting a good mortgage rate. If your credit score is 620, for example, you'd be at least one interest point higher than a borrower with a score of 720, or you might not even qualify at all.

If you discover delinquent accounts on your credit report, settle them, a top tip for buying a home. Even a $40 department store bill that went into collection could significantly affect your credit score. Remember, if you spot a problem and report it, it may take weeks before it's removed from your credit report.

3. Get A Preapproved Mortgage  

In this tight lending environment, you should get preapproved by a lender before you start visiting open houses. Scanning the newspaper or websites for rates won't be that helpful, since lenders adjust your rate based on the sort of risk they believe you are. Once you're approved, you'll know what kind of financing you're in the range for and what your interest rate might be. 
 
Since rates will fluctuate as you shop for a home, regularly check in with your bank. It's possible for a bank to preapprove a mortgage one month, then reject it the next. When you have a ballpark estimate for the financing you can get, plug it into a mortgage calculator to see how much home you can afford to buy.

4. Be Ready To Budge On Your Budget...a Little

Buyers have more negotiating power than ever, so don't be afraid to make an offer that's below the asking price, a top tip for buying a home in this market. Still, if you find a home you adore, it's not worth losing it if the seller refuses to go down a few thousand dollars. Think of it this way: An extra $10,000 (on a loan valued under $417,000) will cost you just $60 more a month; that's about one dinner out with the family.

5. Don't Sign a Contract With Contingencies

The last top tip for buying a home: Find a seller who's ready to move quickly; avoid contingencies in a contract that would allow a seller to stay in his house for an extended period of time. Also avoid having a sale depend on a seller finding a new home. You risk waiting around for months as the interest rate lock on your mortgage expires, forcing you to spend more money for the same home. Worse, the deal could fall apart entirely, and you'll be back out there looking for your dream home. 
 

Follow these top tips for buying a home and you'll save yourself money...and stress!

Posted by

"When in need; I'll transfer your deed..."

Comments (0)