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Buying a House

Written By: Austin Quinn

Buying a home isn’t as simple as it may seem at first. Between fluctuating property values, unforeseen local tax laws, and sudden crime waves in the neighborhood, there are plenty of factors that make it difficult to find your dream home for an affordable price. If you’ve ever bought a car, paid for college tuition, or taken out substantial loans, you’ve dealt with large expenses before. But, have you dealt with the complexities of buying a home? Where do you start, and where do you go from there?

Take Your Time

Buying a home is like looking for work. Ideally, you’d like to find an employer with a comfortable workplace atmosphere, decent benefits, and pay that matches the quality of your expertise. Buying a home is quite similar. Finding a comfortable neighborhood in close proximity to the supermarket and local shops – that’s also reasonably priced – is tough to find. Making that first down payment will take a significant chunk out of your savings, so do try to save early and prepare for any additional costs – including taxes – that you might not normally expect. Just remember to be patient when looking around.

Do Your Research

As explained by the folks at SmartAsset, research is a critical step towards buying the right home for you. Make sure to assess the neighborhood carefully. Take note of shifting home values and other changes in the market. Watch out for risk factors that may cause your home to decline in value. Are foreclosures on the rise? Are crime rates rising? Maybe local businesses are closing shop? Or, perhaps the neighborhood seems overvalued – indicating a possible real estate bubble. All of these factors and more may reduce the price of your home in the future.

Of course, there are plenty of other considerations that you should think about before making a decision. Moving to a place with a high cost of living will chip away at your savings over time, and in some areas, natural disasters may be common enough that they require extra insurance. Hurricanes, tornadoes, floods, and earthquakes can all cause severe destruction and insurance rarely covers everything. Researching as much as you can about your new home will help you save plenty of money in the long run.

Review Your Credit

Do you pay back your debts? Can the bank trust that it will see a return on investment when lending you money? Credit is a substantial factor in the process of buying a home. When lenders decide whether or not to grant you a loan, they turn towards your credit history to judge if they can trust you with a large investment. That’s why checking (and improving) your credit score is essential if you’re looking to purchase a new home. The higher your credit score, the higher your chances to receive a loan in the first place. Even if you do get a loan with poor credit, this loan will likely have a higher interest rate. Stay patient and work on improving your credit score before approaching the bank.

Prepare to Negotiate

The real estate market often allows room for negotiation. If you’ve hired an agent to help make the process easier, he or she can help you approach the seller with an appropriate offer or counteroffer. Just be careful not to go too far and irritate the owner with aggressive haggling. Thankfully, you also have opportunities to negotiate with lenders and save on closing costs. You can sometimes get your lender to reduce these fees or even cover them completely if you’re lucky.

The best way to get a great mortgage rate is to shop around and be patient. Keep an eye on interest rates as well so that you can snag a deal at the best possible opportunity. Getting preapproved for a home mortgage will also let lenders know that you’re serious.

Take Advantage of the HECM for Purchase

When most people think of a reverse mortgage, they assume that it only applies to a home that they already own. However, the Home Equity Conversion Mortgage (HECM) for Purchase is a type of reverse mortgage designed specifically for seniors looking to buy a new home without having to worry about a monthly mortgage payment, though they will still have to pay property taxes, homeowners insurance, and property maintenance costs. Many seniors use the HECM for Purchase to buy a dream home, move to a warmer climate, or visit loved ones.

Get a Second Opinion

It’s easy to step into a house for sale and instantly know that you’ve found your dream home. However, it’s also easy to miss a broken water heater or another expensive flaw hidden beneath the plaster and paint. Getting a second opinion from a friend or relative who doesn’t have skin in the game is usually a good idea – they can let you know whether you’re missing out on obvious flaws and broken fixtures. Keeping up with property maintenance is already a hassle as is – to avoid problems right from the start, make sure to observe each home you visit with greater attention to detail.


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How to Buy a Home and Save Money Doing It