Buying a home is one of the most exciting experiences out there, but it can also be incredibly stressful! For many of us, this is by far the most expensive purchase we’ll ever make. It makes sense to try to save as much money as possible during the process without cutting corners or making sacrifices.
And we’re here to help. This article will go through four ways you can cut back on costs when buying a house. You’ll breathe easier knowing you’re taking proactive steps to save money during one of the most high-priced (and high-pressure) transactions there is.
1. Get the Best Possible Deal on Your Mortgage
Your first time dealing with a mortgage company can be overwhelming. Fortunately, mortgage consultants at reputable firms are experts at finding ways to help you save money. An experienced consultant can help you determine your eligibility for down payment assistance programs, and most firms offer loan term programs custom-tailored to their clients’ needs.
When choosing a lender to go through, don’t just settle for the first one you come across. Look for a mortgage company with a 4.9 star rating to ensure you’re getting top-quality advice. Your mortgage and your down payment are the two major expenses that go into buying your house, so it’s smart to make sure you find an expert lending agency to work with.
2. Choose a Dependable Real Estate Agent
Having a highly-skilled real estate agent that is intimately familiar with your local housing market can save you both time and money during your housing search. With a professional agent on your team, you’ll have access to insider knowledge about the area you want to live in. Your agent will also be able to advise you about navigating the home-buying process, a bonus that first-time homebuyers will find indispensable.
If you have friends or family in the area, ask them for recommendations for great local real estate agents. You might also find it useful to ask residents in the neighborhoods you’re interested in if they have a favorite agency to go through.
3. Improve Your Credit Score
Before buying your home, you’ll want to make sure your credit score is as high as possible. You likely already know that you need a good credit score to even qualify for a mortgage in the first place, but you might be surprised to learn the extent to which your credit score affects your mortgage rates. It’s been shown that even a “good” credit score can cost you tens of thousands in interest payments compared to a “great” score. The higher your credit score, the lower your mortgage rates will be.
4. Buy in Winter, Not Summer
Spring and summer are the most popular times to buy a house across most of the United States. Consequently, since demand is so high during those months, supply is often scarcer, and housing prices also tend to be higher.
Depending on your needs and where you’re moving, it might be prudent to start your housing search in late fall or winter. Studies have found that the best month to buy a house in most states is January or February. Housing prices can rise by as much as 18% between winter and summer, so if you can, skip the summer housing rush and wait for colder weather.
The Bottom Line
Buying a house will always be an expensive undertaking, but there are many ways you can cut back on costs. By following these four tips, you might save thousands of dollars when you buy your first home. If you want to save big, be prepared to adjust your plan a little. It may mean waiting until this upcoming winter instead of ASAP. This gives you plenty of time to choose a property wisely and boost that credit score.