Tips for buying a house (part 5 of 5)
TIPS FOR BUYING A HOUSE (Part 5 of 5)
One big real estate tip is with any house purchase, how much money you are putting down will affect the house you are looking to purchase. In todays market, most lenders are wanting the buyer to put some money down on the purchase of your house. There are some lending programs that allow a buyer to put little to no money down, buy you will need a good credit score and be able to meet some other criteria in order to apply for those programs. It is always ideal to have a down payment set aside. Twenty percent or more will always make the bank approval process much easier. If you can put twenty percent down then you will also not be required to have private mortgage insurance (PMI) which will not only give you equity in your home but reduce your payments. There are many programs that do not require twenty percent, but many still require a sizable sum to be put down. Saving up the down payment can be very hard, and can take some time. Planning ahead is the best way to get this accomplished. If you take my advice and make the fake payments to yourself to test how much of a mortgage you can afford, you can save up money fairly quickly. Using that method will not only expedite the process to get your down payment saved up, but you will also already be in the habit of making the full mortgage payment. It will still take several months to several years depending on how expensive of a house you are planning on buying. Planning and preparation are the key.
Why are you buying
Another real estate tip that you may need to consider depending on what part of the country you are buying in or what you are buying the property for. Doing your research before you even start looking at houses can help you make an educated buy instead of an impulse buy. Even following these guidelines, there is no way of removing all risk involved in a real estate purchase because there are too many factors that are out of your control like the stock market, but you can reduce the risk involved by following these tips. I recommend that you talk to local professionals that know the area and can help assess those risks to help you make a smart buy. Almost all real estate professionals will tell you that you make money when you buy a home, not when you sell. What that means is that if you make a smart choice when buying your home, you will be able to make money on your home when you sell. Of course that is assuming that we don’t have another real estate market crash or other uncontrollable factors that we can’t control changing the market like the 2008 market crash. The real estate market in continually going up and down. Talk to a local professional and ask about local trends. If you are not in a hurry to buy or sell, you can time your purchase or sale according to the trends and may be able to get a better deal then you would another time of the year.
One last real estate tip, don’t let anyone pressure you into buying a home that is above your ideal price range. Some real estate agents will try to get you to buy a higher valued home because they get paid on commission and they want a bigger pay check. Stick to your guns and be an educated buyer who knows exactly what they want and where. I think you will appreciate the end result.