Frugal Home Buyers: 5 Ways to Save Money When Buying a New Home
Buying a home can be prone to lots of unexpected expenses, especially if you are a first-time buyer. It is among the biggest investments you will ever make.
If you invest smart, you will enjoy the fruits of your efforts many years to come. However, any slight misstep may cost you a lot.
To help you make a successful purchase while saving money, here are five tips to guide you.
Secure a Mortgage First
Finding the perfect home before you are preapproved for a mortgage can be a costly mistake. At least three months before you commence house hunting, you need to check out the available lenders.
This will give you sufficient time to pay off outstanding debts and even enhance your credit score, which qualifies you for a bigger loan. It also eliminates pressure when the time comes for you to make an offer for a home.
Ask for a Contingency Clause
A contingency clause gives you the ability to void a contract made under pre-negotiated circumstances without the loss of your “earnest money.” It protects you in case the property does not appraise for a particular amount or if your mortgage loan falls through.
A contingency clause gives you the right to cancel a contract or negotiate for repairs depending on your home inspector’s report. It also guarantees you a specific duration for you to sell your existing home.
Pay for Inspection
Before purchasing a home, check the condition and age of the expensive fixes such as the roof, foundation, windows, furnace, attic insulation, plumbing, and appliances.
The cost of repairing these items may far exceed the cost of a thorough home inspection.
Know the Neighborhood
Researching the demographics of your prospective neighborhood is crucial. Elements such as crime, quality of school districts, and availability of particular amenities will affect the value of your property.
It is imperative to consider the number of renters living in the neighborhood because this is also a factor that will influence the value of properties. There are numerous advantages of purchasing a home in a neighborhood development area which include:
- Ease of access to local amenities, shopping, and restaurants
- Less traffic from people who live outside the community because there are no through streets.
- Safety and security by neighborhood watches. Also, many home builders provide alarm systems when constructing the homes.
One of the best ways to be sure that you are buying a home in a reputable neighborhood is to buy a home from a neighborhood developer like EXR or another company.
Buying in a new development is usually a guarantee that your neighborhood will be a nice place to live for the next several years at least.
Don’t Fear to Negotiate Buying a Home
Closing costs can accrue up to eight percent of the purchase price. So it is a good idea to request the lender to cover some or all of these fees. You can also choose a mortgage with a no closing cost clause.
Buying a home is not a simple matter because there are lots of costs and procedures involved. However, when you follow the above tips, you will simplify your home buying experience.
Share this:
Category: Housing
