Did you realize that over 50 percent of Americans only have around $1,000 in savings? If you are looking to buy a home in the near future, bulking up your savings is essential.
Being able to come up with a hefty down payment is a great way to lower your monthly mortgage payment. Even if you are only able to come up with a few thousand dollars, using an FHA home loan can get you the lower monthly payments you are looking for. Typically, these loans will approve a borrower with as little as 3.5 percent down.
Are you curious about how to save money during the home buying process? If so, check out these helpful tips below.
Use an Experienced Real Estate Agent
If you are new to the home buying world, having a professional to offer you some guidance is essential. An experienced and knowledgeable real estate agent will have the in-depth knowledge needed to get you the best price on a new home.
Some first-time homebuyers think they can save money by avoiding real estate agents altogether. This will generally lead to a buyer getting overwhelmed and making mistakes as a result.
Your real estate agent can negotiate a number of items in the home buying contract that can get you a much better deal. Typically, the commission paid to a real estate agent will come from the seller and not the buyer, which is all the more reason to work with one of these professionals.
Get Multiple Loan Quotes
Shopping around for the right mortgage may be time-consuming, but it is well worth the effort. The last thing you want to do is settle on the first mortgage you come across.
By comparing what each of the lenders in your area can offer, it will be easy to find the right mortgage to fit your needs. When going in for consultations with these lenders, asking questions about the interest rate and repayment terms is a good idea.
Whenever we start the home buying process I always look into LendingTree. They are going to give you multiple loan quotes, which will help you find the best interest rate. This could potentially save you thousands.
Work on Increasing Your Credit Score
The amount of interest you pay on a home loan will be directly related to your credit score. If you have a lower credit score, you can expect to pay a much higher interest rate.
Before you apply for a home loan, you should try to improve your credit score by doing things like pay down your credit card balances. You should also avoid applying for any new credit before applying for a mortgage. While this may prohibit you from getting a home right away, the money you save will make this wait worth it.
Not sure what your credit score currently is or what factors are influencing your current number? Sign up for Credit Sesame. It’s free, easy to use, and will give you the insight to know if your credit score is ready for home ownership.
Invest in a Fixer Upper
Do you have experience in construction? If so, buying a home that needs a little work may be a good option for you. Generally, these homes are far less expensive than new homes in pristine condition.
Before you decide to buy a fixer-upper, get a home inspector to take a look. You want to make sure there is no structural damage to the home due to the danger this can present.
Rushing through the home buying process will generally lead to a lot of mistakes being made. Taking your time and seeking out the help of professionals in the real estate industry will allow you to get the great deal you are after.
