Is now the right time to buy a home? The decision to purchase a home is undoubtedly a very exciting one. It’s easy to get caught up in the fun parts. Like choosing your ideal house style, picking out paint colors, and planning a shopping list to outfit your new place when you move in.
It is important you are in a position where purchasing a home is beneficial to you and your finances. Purchasing readiness can boil down to a few key points, and these are some to consider.
At GoPrime Mortgage, we’re dedicated to serving our clients by making homeownership possible through personalized service and solutions. That includes ensuring you’re in the best position to secure a mortgage.
A large part of the decision to buy a house comes down to your target neighborhood and goals. No matter the national headlines, real estate markets are very hyper-localized and sometimes vary greatly from one market to another. Building a team with a trusted agent and local lender ensures you are knowledgeable of the area and home trends.
The process of applying for a mortgage is relatively straightforward. There are best practices that we recommend to our clients before getting started on the house hunt. We encourage everyone to get pre-approved before falling in love with a home. A pre-approval gives you a clearer sense of a realistic budget. It also can expedite the purchasing process and give you a competitive edge when you find one.
There are many other costs involved in purchasing a home than just the down payment. These include moving services and supplies, potential HOA fees, and any renovations you may want to make to the house.
Before approving a loan, the lender needs to make sure that you have solid and stable credit. Low or poor credit may result in higher interest rates or down payments. Working with a local lender who will take the time to understand your needs makes the process that much smoother. Every situation is going to be unique, so it’s important to figure out what may be best for you financially.
Paying your bills on time and maintaining a strong credit score is important. As well as making sure that you have saved enough money to make the purchase. A larger down payment can help you throughout the life of your loan by potentially lowering the interest rate.
GoPrime has many loan programs that can provide assurance and stability. This includes our Lock and Shop program and 2-1 Buydown program. The Lock and Shop option allows you to lock in your rate and shop confidently to find a home that fits your needs and close within 60 days with that confirmed rate. The 2-1 Buydown is a type of financing that lowers the interest rate on a mortgage for the first two years before it rises to the regular, permanent rate. Reach out to your local lender to discuss if one of these options fits your needs.
Buying a house can be a long-term commitment. Consider your future finances; even though a more expensive home or newer build may seem worth it upfront, be sure to think about what the monthly payment for that house may be – including property taxes.
Always remember that owning a home comes with unexpected costs like repairs, so it’s smart to set aside funds for those emergency situations instead of using all your money up front. Look for potential issues with the house by considering things such as:
It typically makes the most sense to buy a house if you plan to be in the home for at least five years, which is when you usually will break even on the mortgage. Clare Trapasso, executive news editor for Realtor.com notes that “This gives a property time to appreciate over time.” She adds that “Sellers typically spent about 10 years in their home before putting it on the market, according to a recent National Association of Realtors report.”
If you have plans in the near future to move out of state or pursue a larger home, it may be better to wait on purchasing for now. This delay also allows you more time to save up money for a higher down payment.
Becoming a homeowner can provide a feeling of pride. While also boosting your long-term financial outlook through equity – if you begin the process well-prepared. There are many moving parts in the mortgage process. This is why GoPrime prides ourselves in walking with our clients every step of the way on their road home.
If it is time for you to move forward with buying a house, here are a few tips:
Remember, purchasing a home is likely to be one of the biggest financial transactions you make during your life. Building equity through your home or leaving home to your children are just a couple reasons that people choose to pursue homeownership. Consider what your desires, needs, and budget are, work with a knowledgeable local lender to determine the ideal program for your situation, apply for pre-approval, and take your time when it comes to finding a home. It’s an exciting time, but it’s important to be sure that you are prepared for your journey to homeownership.