Overlooked Personal Finance Hacks for Homebuyers

The housing market is on the rise. Whether you are trying to enter the market or are searching for your next property, there are ways to save money and secure an offer. Here are some personal finance hacks you can use to procure the property of your choice.

Do Your Research

Start by doing your research. Currently, down payments are going up, according to ATTOM Data Solutions. However, different parts of the country have different averages. Coastal regions tend to have larger down payments, so look at what other people are averaging in your locality. Yet, no matter where you live, the larger the down payment you can produce, the more likely you are to have your offer accepted. Loans and crowdfunding are ways you can make sure you have the capital you need to enter the market.

Don’t overlook the listing prices as 5.2 percent of homes sell below their price in Brooklyn, New York. If you offer the listing price, you may be out pricing others looking at the home you’re interested in. Not only that, but also the seller is more likely to work with you if you’re willing to pay what they are asking for, including tending to some necessary repairs. You can always negotiate later on especially if the property doesn’t mean appraisal value.

Tend to Your Credit

You may know that having a good credit score can make life easier when buying a home. You’re more likely to get a good loan with a decent interest rate. Take a bit of time to improve your score if it’s low. Pick up any missed payments, and do what you can to reduce your debt immediately. Remember, paying off an account won’t remove it immediately from your score, but paying your cards on time each month may greatly increase your score. However, it’s not enough to simply make sure you have improved your credit. Before and during this period, do not open any new accounts. When you open a new account, your credit is always dinged, and your score dips. Even a slight dip can have a huge impact on the mortgage you get, so put any new activity on hold.

Homeowners Insurance

One of the costs you’ll need to consider is your homeowners insurance. It can be pricey, but there are plenty of ways beyond bundling and shopping around to keep your costs down. You can install an alarm system, as many insurance policies provide discounts to those who do. Keeping your home weatherproofed and updated also can garner you sizable savings. Make sure your roof is fire-retardant and that it is able to withstand storms and leaks. New wiring can get you a discount, so replace any copper wires with safer ones. Having good detectors may lower your rates, so update the carbon-monoxide and smoke detectors. Don’t hesitate to simply ask what discounts your provider gives and how you can qualify for them.

Plan for Hidden Costs

If this is your first time buying a home, there are many additional costs you need to be prepared for. There will be property taxes, mortgage insurance if you cannot afford a sizable down payment, repairs, updates in technology and hardware as well as closing costs. This comes after you submit for your mortgage and includes a multitude of fees. It typically covers inspection and appraisal fees, numerous paperwork fees and much more. These can end up being intimidating, but often you can negotiate for the seller to pay for part or for the fees themselves to be reduced.

Different lenders may charge different amounts, so look for the lender that offers the lowest fee. Look at your loan estimate and make sure you aren’t being overcharged. They may try to pass off the same charge under distinct, but similar names, so read closely.

This is going to be an expensive venture. However, with a little work, lots of research and plenty of negotiation, you may be able to lower your overall costs and fees. Put these hacks into action and with luck, you’ll shave off a sizable amount of your total expenditure.

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