How to buy a new home and get the best deal means doing some work yourself
As a person who makes a very good living buying and selling real estate, I have learned what it takes to get the best deal. Here, I will share some of the tips on how to buy a new home so that you’ll be happy with the end result.
Real estate agents like to say location is everything. When you are buying a house, that’s not completely true. What’s more important than location is your ability to buy the house. Money absolutely matters. If you can’t afford to buy the home, it doesn’t matter where it is located or how much you like it.
How to Buy a New Home Through Financing
Keeping your credit clean is critical. This starts well before you begin house shopping. Bankers will tell you that keeping credit good is the most important factor in how to buy a new home.
“It’s not wise to make any huge purchases or move your money around three to six months before buying a new home. You don’t want to take any big chances with your credit profile. Lenders need to see that you’re reliable and they want a complete paper trail so that they can get you the best loan possible,” states an article at Home & Garden TV’s website.
While I agree with that, your credit report has to be in good shape for several years to get the best possible interest rate on your mortgage. Hold off large purchases if you can. Don’t open lines of credit or get new credit cards.
Speaking of mortgages, start the loan application process before you begin looking for a house. Sometimes a mortgage broker is a good idea. The broker specializes in how to buy a new home. He can gather bids from several different companies and help you evaluate the offers. You can also call banks and see what kind of rates and down payment requirements they have. You’re not going to get a firm quote until you fill out mortgage paperwork, but you can get an idea.
Get pre-approved. This tells you how much you can spend and offers you an interest rate that will stay within a fraction of percent or so of the final rate is locked in. However, this tentative rate is only going to be good for a short while. A word of caution: Don’t let a changing interest rate rush you into making a home purchase. Interest rates fluctuate constantly.
How to Buy a New Home With Help From Professionals
With solid information on the financing, it’s time to start shopping. Get professional help, said Amy Hoak, a writer for Market Watch. “Interview a few agents who work in the neighborhoods you’re interested in, and make sure they have relevant expertise. For example, if you’re looking for a starter house, don’t choose someone who focuses mainly in luxury homes,” she wrote.
This is where location matters. Don’t lock yourself into one specific neighborhood. Look around at other communities and see what they have to offer.
Two items not often considered in figuring out how to buy a new home are taxes and insurance. Property taxes also vary from city to city and county to county. Crossing a county line could save or cost hundreds to thousands of dollars a year in taxes.
Insurance rates also vary. Homeowner insurance is partly linked to fire protection. The better the fire department, the lower the insurance. Being inside a city with a full time fire department v. being just outside the city where there’s a volunteer fire department can make a big difference in premiums.
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