For some people looking to buy a home these days it can seem like a very expensive endeavor. Home prices are still higher and mortgage rates have climbed into the 6% range for a 30-year fixed which is a lot higher than they have been in recent years. Furthermore, some economists are speculating that home prices will continue to rise year over year in 2023. Given these facts you may want to consider some ways that you can save some money during this transaction. Here are a few ideas. 

Low Down Payment Loan

Nowadays many homebuyers are not able to put a full 20% down towards their home purchase. However, the good news is that you may be able to qualify for a loan that requires a lot less. An FHA loan allows you to get away with putting as little as 3.5% down, but you just need to have a good enough credit score (above 580). A loan such as this will have some other guidelines to follow or requirements such as mortgage insurance.

Down Payment Assistance Programs

If coming up with a down payment is a large hurdle for you, look into assistance programs in your area. Some of these programs do low or zero interest loans or provide money towards your upfront costs. Eligibility is based on credit and household income. These programs vary but some do require you to take a course as well as be in an approved location. 

Down Payment Gift

Some buyers are fortunate to have family members who can help with a downpayment as a gift. This is permitted but there are guidelines. Lenders will want to confirm that this is in fact a gift and that it is not required to be paid back as that can affect your loan qualification. A gift letter stating this will be required as well as evidence of the transfer of funds. While there is no limit to what you can accept as a gift, if more than $15,000 then the family member will need to file a gift tax return to disclose it.

Auctions and Short Sales

With inventory still on the slim side, it is wise to keep an open mind about the property you are looking for. Buying a home at an auction is great as it can be a quick sale and still get to pick the price. A short sale can also be a way to save as banks are looking to liquidate for what they are owed which is often for less than market value. These types of properties are not as common to find these days but another option is to look for a home in need of updating. These homes should be priced lower and you can always make updates over time which saves you up front.

Any kind of move whether it is down the street or to a town far away can be a stressful experience. However, with the right planning you can make moving day go very smoothly. Here are five tips for helping you achieve success.

Have a plan

Like any big event, everything starts with making a list. Make a checklist of everything you need to do but also include deadlines for each item. Be sure to include things like when to arrange movers, when to have items packed, when to change your address and so forth. You will rest easily knowing what you need to do and also have a sense of accomplishment when you check off items that you complete.

Declutter

Your move will certainly be easier if you lessen the load. Go through your home room by room and start to declutter. Either throw out, donate or sell any unwanted items that you know won’t be needed or will not fit in your new home. This will save you time and money in the long run. If you can sell anything you can even make some money!

Label boxes

Packing your things away by room and by category is going to make your move so much easier. For one, movers will know what room to place each box in. When unpacking you will know what goes where and which box to start with when they are labeled by room and by the type of contents.

Make an Essentials Box

You will not be able to pack everything away as some things are essential to have on hand. This includes clothes for moving day, toiletries, medications and the like. Think about the items you will need for yourself and your family and make one box or bag for these things and keep it with you instead of putting it in the moving truck.

Hire Professionals

Hiring a professional moving company can be a real stress reducer for your move. Hiring a company that is reputable, insured and well known in your area can really take the burden off of you on moving day. You can hire them just to move your items or to help pack them as well. Chances are you may have to get friends or family members to help you, so why not spend some money on hiring professionals with the right tools to get the job done right with your valuables well protected. 

If you are looking to make a real estate purchase soon, it is important to know what to pay attention to in your contracts. With a home purchase being one of the biggest investments that you may make in your life, it is crucial that these legal documents have you fully protected. Here is a closer look at those details.

Contract Basics

All contracts should clearly list some basic information about the parties involved. The property address, contact information for buyer and seller along with government issued ID numbers for each party. Of course the agreed upon sale price, earnest monies paid and important dates should all be recorded.

Terms and Conditions

The main part of the contract should address all terms and conditions that are associated with the home purchase. This should include things like how disputes get resolved should they arise during or after closing along with spelling out any contingencies for repairs or the like that should be completed prior to closing. Furthermore, be sure the contract states who is responsible for closing costs. These can change from deal to deal as sometimes they get negotiated during the deal. 

Contingencies

Other than outlining the standard contractual obligations, your contracts should include contingency clauses that protect your interests in case something unexpected occurs prior to closing day. For example, it is not uncommon for buyers needing their current home sold before they can buy another one. Should this be the case then you should make sure that includes a “Sale of Buyer’s Property Contingency” clause that states you won’t be held responsible for purchasing until your current home is sold at an agreed upon price within a specific amount of time. Other standard contingencies include financing approval from banks or lenders, satisfactory home inspections, title insurance coverage being granted without issue and the like. For any questions about how to incorporate contingency clauses into your contract, work with a real estate attorney as they are the experts on using language that will protect your interests. 

When moving into your new home you will want to make it both comfortable and efficient. To accomplish this you will need to select the right appliances that will save you money and provide you with comfortable living. Here is some helpful information on how to go about this.

Water Heater

Historically most homes have always had a hot water heater that involves a large tank. The tank works regularly to heat the water to be on standby but inevitably will experience some heat loss meaning the unit needs to continuously work to maintain its temperature. Nowadays modern homes or renovations are often using a tankless system as they can be more efficient. The other benefit is that they are smaller and can easily fit on a shelf or wall where they take up less space. There are only a couple of drawbacks to this system. If you have several sources pulling off the system you may not have a strong enough unit to supply the heavy demand. Additionally, should you lose power then you will lose your hot water as there is no reserve tank to pull from.

HVAC

Most homes will have an HVAC system that will heat and cool the entire home by way of ducts bringing the air to each room. Air filters are used to control dust and debris which need to be changed regularly, but still have some pass through. While this may be the most common system, it is not the only one. More and more lately we are seeing split systems for a few reasons. For one, they can be healthier as they are ductless which improves air quality. Additionally, where there are multiple units you have the ability to only run the zones you want which improves efficiency.

Kitchen Appliances

The kitchen is almost always regarded as the heart of the home. Whether it is just you and family home or if you are entertaining it is one room that so much time is spent in. First, you will want to make sure that you have a nice set of matching appliances including your supplemental counter appliances like coffee makers and the like for the proper aesthetics. Then when selecting these, take the opportunity to have ones that not only offer the right features for you, but are also energy efficient for cost savings. 

Vacuum

Start things off right with a good, high-end vacuum. Your vacuum is a staple household item and will ideally be called on for many jobs regularly so investing in a good one can pay off. Ideally one that is lighter weight, can do different types of carpeting, hard flooring and has attachments for hard to reach corners and ceilings. One with an upholstery attachment is also a big bonus especially for those who have pets!

Investing in the right appliances will have you living a more easy and comfortable life, you will be happy you did!

Today’s real estate market is ever changing. The process of buying a home in the past few years is not quite like it is today. While inventory is a little better than it was, rates are higher now which makes for a different set of challenges. Today’s homebuyer finds success when adhering to a particular mindset. Here are some pointers of what can be helpful. 

Persistence

The real estate market may be cooling slightly, but there still are pockets of neighborhoods or properties that are still hot. That means there could still be some bidding wars happening. Buyers who remain persistent will find themselves being the winning bidder.

Emotional strength

Buying a home can be a very exciting time as you tour properties and envision yourself in them. However, especially where you can still find yourself in a competitive bid, it is best to keep your emotions in check in case you are not the winning offer. Be prepared to get back on the horse and move onto the next property.

Keeping an open mind

Typically when buyers shop for a home they limit themselves to a smaller area. However, these days work options are becoming more flexible allowing for one to be able to live in other areas. This may have you looking at being flexible on looking at other locations that may be a better buy for your money with more housing stock to pick from.

Ask questions

Keep in mind the purchase of a home is usually one of the biggest ones that you will make in your life. So, be sure to ask as many questions as you can think of when touring homes and learning about areas.

Look past appearances

The majority of people will want to find a home that is move-in ready and turnkey. However, not all properties are perfect and in the interest of opening up options, consider a home that may need some cosmetic updates. These can be completed over time while you make the home uniquely yours.

Establish wants and needs

Ultimately there is no perfect home. While you may find something that is absolutely perfect, chances are there is still something that it may not have that you originally had set out for. To help open up your options, consider what you want versus what you absolutely need. Needs should be the things that you cannot part with like bedroom count, while wants can be something that you can add later like an updated kitchen. 

Stay flexible

This is also a big benefit by staying flexible. That means being able to view homes when they are new to the market and also remaining open to contract term negotiations. Perhaps you could be amenable to a sellers preferred closing date or the like. 

If you are planning on buying a home in the near future, you are probably focusing on saving as much as you can for all that is involved. One of the largest things at the top of your list is probably the down payment. While 20% is often the number thrown around, don’t let that scare you or prohibit you from making your move. 

20% Is Not The Norm

According to Freddie Mac, “. . . nearly a third of prospective homebuyers think they need a down payment of 20% or more to buy a home. This myth remains one of the largest perceived barriers to achieving homeownership.” Unless outlined by your lender or loan type, it is not required to put as much as 20% down on your new home. Per the National Association of Realtors (NAR), the median down payment has not been more than 20% in nearly 20 years. Today it is more like 14% and just 6% for first-time home buyers. 

Know Your Options

If saving for a down payment still feels like it’s an uphill battle, know that there are options available. A real estate professional and a good lender can show you options that could help you get closer to your down payment goal. According to the latest Homeownership Program Index from Down Payment Resource, there are some 2,000 homebuyer assistance programs in the U.S., and most are intended to help with down payments. Additionally, there are loan types, like FHA loans, with down payments as low as 3.5%. Furthermore, there are options like VA loans and USDA loans with no down payment requirements for qualified applicants. To learn about all of your options, be sure to do your homework and partner with a trusted lender to learn what you qualify for in your home buying process. If you need help with where to start, please reach out to me today. I am happy to help!