Top 10 Home Buying Tips

Interest rates are low, and home purchase prices are down. It is a great time to buy a house. If you are considering taking the plunge, there are a few things that you should consider before you commit. Check out these top 10 home buying tips to help you decide whether now is the right time for you to buy.

  1. How long do you expect to stay in the home that you are considering purchasing? Even though it’s a great time to buy, there are still significant costs associated with buying and selling a home. In order to make purchasing a home financially worthwhile, you should plan to stay in that home for at least a few years. Home prices are beginning to rise, but you still may not be able to recover your expenses if you move again in less than a few years.
  2. Clean up your credit. When you apply for a mortgage, you want your credit to be the best it can possibly be. A higher credit score will help you to get a better interest rate, which can have a big impact on your monthly payment. Before you start the application process, get a copy of your credit report. Check it for any errors, and have those errors corrected before you work on getting a mortgage.
  3. Carefully consider your purchase price range. A mortgage is an expense that you have to live with for a long time, so make sure that you can afford the home that you purchase. A general rule of thumb is that your home should cost approximately 2.5 times your annual salary. You can also use online calculators to help you figure out what your payment would be.
  4. You don’t need a huge down payment to buy a home. Years ago, home buyers needed a 20% down payment. Today, you can get interest rates as low as 3.5 or 5%.
  5. Choose a home in a great school district, even if you don’t have kids. The school district is a big priority for many home buyers, and it can make a big impact on your home’s resale price and the ability to resell quickly.
  6. Use a real estate agent. You can browse listings online by yourself, but a real estate agent has valuable knowledge, experience, and the inside scoop on the local market. You will find this guidance invaluable as you are completing the home buying process.
  7. Think about whether you would rather pay points or take a slightly higher interest rate. Points are a fee that you pay at the time of closing in exchange for a lower interest rate. You can also choose a loan that doesn’t charge points, but the rate may be a bit higher. If you are going to stay in the home for more than a few years, you typically save money in the long run by taking the points.
  8. Get pre-approved before you start shopping. Once you have a pre-approval, you can relax and trust that you can actually afford the homes that you are considering and get the necessary financing. Sellers will take your offer more seriously when they see that you are pre-approved.
  9. Look at sales trends in the neighborhood before making an offer. This is where your realtor’s assistance will be important, and this information will guide you in making an offer.
  10. Get a home inspection. It is always better to know about problems before you close the deal.

Contact Barrie and Area Real Estate to find a real estate agent to help you through the home buying process.