5 Timeless Tips For Buying Real Estate
Posted on: 20 March 2019
Buying real estate can be a process that takes time, but you can tighten things up if you know what you're doing. If you follow these 5 timeless tips every real estate agent uses, you'll be ahead of the game.
Line up Financing Ahead of Time
When you don't really know what your upper limit is for buying and remodeling a place, you end up in a situation that paralyzes your decision-making. Worse, if you find a location you love, you'll have to wait for the bank to approve your financing. You may get a no, but that's not the worst outcome. The worst real estate purchasing scenario is the bank sets you up with the money you need, but the place has already sold while you were waiting.
Have a Large Down Payment Ready
Getting the best interest rate possible will ensure that you can keep up with payments. To accomplish this, you want to have something in the neighborhood of 20% of the total value of the property available to put down. The bank will see this as a sign that you are serious, and your chances of getting a good interest rate will go up. You may also be able to get a reduced rate for mortgage insurance.
Focus on Buying Just a House
Your credit score can fluctuate a surprising amount if you're tacking on things like credit card debt or car loans. Unless you know your credit rating is near perfect, it's wise to avoid taking on new debts while you're waiting for financing.
Consider Renovating
While it's nice to buy a ready-made dream house, the reality is that the best way to get more equity out of a piece of real estate is to buy it for a low price, put money into remodeling it, and then draw value from improving it. Likewise, remodeling will give you a chance to modernize the house, ensuring that it'll hold up aesthetically for a longer time. There can be a huge upside in this approach if you're capable of handling some remodeling tasks yourself.
Explore Programs
There are a number of programs in the U.S. for helping prospective homeowners out with buying properties. In particular, FHA, VA, and USDA Rural Housing loans are popular choices.
Don't assume that having a high income means you're out of options, either. There are still programs that can help you. For example, Fannie Mae helps qualified buyers with the 97% LTV loan program.
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