9 Ways To Afford and Protect a New Home

Home Stager with Freelancer

When house prices are on the rise and interest rates are also on the way up, affording a home can seem like a faraway dream. You can save for a down payment, of course, but that can take longer than you want to purchase a house.

Fortunately, there are other steps to make your dream of home ownership come true and protect it when you find the perfect one.

1. Look for Career-Related Special Mortgages

Some lenders offer special mortgages to people in specific careers. These loans often require no down payment and come with competitive interest rates. If you're a public servant, such as a firefighter, government employee, teacher or healthcare worker, you may find a particular mortgage available.

2. Budget for an Appraisal

The home buyer is usually responsible for paying for home appraisals. However, depending on the market and seller, you may be able to negotiate the cost. You can expect to pay $300-$400 for an appraisal, but prices can vary depending on the house size and the state you're buying in.

3. Shop for Down Payment Assistance

Many state and local governments offer down payment assistance programs for buyers. Most assistance is for first-time buyers, but it doesn't hurt to check.

You can potentially receive down payment assistance in one of these forms:

  • Repayable loan: You pay it back monthly in conjunction with your mortgage.
  • Forgivable loan: If you remain in your home and don't sell or refinance it, your loan is forgiven over time.
  • Deferred loan: You repay it when you sell, refinance, move or finish paying your mortgage.
  • Outright grant: This assistance requires no repayment.

4. Apply a Second Income to Your Mortgage

Do you have a side hustle? Tell your lender. You may be able to afford a bigger mortgage. You must document it properly for tax purposes, however. Also, most lenders require you to have a two-year history of that income type.

5. Boost Your Credit Score

A high credit score can earn you a lower interest rate, increasing the amount you can afford to borrow. Get your credit reports and inspect them for errors — you may be surprised to find one. If you do, your lender may use rapid rescoring to help you boost your credit score in days instead of months.

Other steps to increase your credit score include making payments on time, paying down your credit card balances, and using a secured credit card.

6. Compare Mortgage Rates

You don't have to settle for the first mortgage rate a lender offers you. Call several lenders and do some comparison shopping. You can even initiate competition if one lender offers you a lower rate than another.

A small amount here and there might not seem like much, but it can add up to thousands of dollars throughout your mortgage.

7. Secure the Locks

Once you have found your home, it's critical to take steps to protect your new purchase. One of the first things to do is to change the locks. You don't know who has keys to your home, even if the previous owners claim they gave you all the keys. Don't forget about the garage or shed doors.

8. Install Cameras

Fortunately, security cameras are getting less expensive all the time. You can install ones that connect to your smartphone, letting you see vantage points around your property.

9. Protect Against Spoofing

Criminals don't always try to break in the front door; sometimes, they get inside another way. Caller ID spoofing happens when a fraudulent caller falsifies the information on your caller ID to look like a neighbor or local agency. Once you answer, they try to get your personal information or money. You can subscribe to a service designed to block spoofing calls.

Affording and protecting your new home takes research, but it's worth the trouble. You can enjoy your home with the peace of mind of doing everything possible to save money and keep it safe.

Comments (7)

John Pusa
Berkshire Hathaway Home Services Crest - Glendale, CA
Your All Time Realtor With Exceptional Service

Hello Dawn Castell these are very valuable list of ways to afford and protect a new home.

Oct 01, 2022 08:21 PM
Richard Weeks
Dallas, TX
REALTOR®, Broker

Great information, thanks for sharing.  I hope you have a great day.

Oct 02, 2022 04:37 AM
Bill Salvatore - East Valley
Arizona Elite Properties - Chandler, AZ
Realtor - 602-999-0952 / em: golfArizona@cox.net

Nine excellent points, especially buying down that mortgage. Great information.  Thanks for sharing and enjoy your week!

Oct 02, 2022 05:39 AM
Wayne Martin
Wayne M Martin - Chicago, IL
Real Estate Broker - Retired

Good morning Dawn. All great tips. Cleaning up your credit should begin long before you seek pre-approval. Once you take possession your first visitor should be the locksmith. Enjoy your day.

Oct 02, 2022 05:57 AM
Jan Green - Scottsdale, AZ
Value Added Service, 602-620-2699 - Scottsdale, AZ
HomeSmart Elite Group, REALTOR®, EcoBroker, GREEN

Your last tip is what I see on my phone daily.  I havea type of call blocker Apple software to stop incoming calls if they are potential spam or not in my caller database.  It works very well.  I've often seen AMER RED which is really wild since I've donated blood several times in the last few years!  I still don't answer as I get their emails.  My email is also scanned by software looking for malware, so they have me coming and going!  Great list!

Oct 05, 2022 09:57 AM
Mary Hutchison, SRES, ABR
Better Homes and Gardens Real Estate-Kansas City Homes - Kansas City, MO
Experienced Agent in Kansas City Metro area

I'm hearing about some alternatives for buyers re mortgages--a temporary rate lock for 60 days ; things like that.  If buyers can be as prepared as possible and don't have to adhere to a hard deadline, it will work out for them!

Oct 05, 2022 12:33 PM
Diana Dahlberg
1 Month Realty - Pleasant Prairie, WI
Real Estate in Kenosha, WI since 1994 262-308-3563

Great Information Dawn Castell ... valuable to anyone seeking home ownership.  I have followed you and hope you will reciprocate!  Have a great weekend!

Oct 08, 2022 12:08 PM