Ways to Save Money When Buying Your Next Home

Investing in a house is very expensive. You will worry about many spending not just on the price of the house but in many other expenses as well such as down payment, monthly mortgage loan, documentation, sales agent’s commission, closing attorney, and many others. If you want to save money when buying your next home, follow these guides: 

  1. Hire an experienced real estate agent.

Getting the service of a prolific realtor will save you not just money but also time. Based on his experience, a realtor knows how to put the right price tag on the luxury real estate Hillsborough CA that you will buy based on several factors. He can help you negotiate for the price that is within your budget. So if you think that DIY is better because it will save you money by paying an agent, think again. 

  1. Apply for a loan from multiple lenders

The interest rates that different lenders will offer to you will vary. Different lenders also have different quotes for processing fees; loan origination fee, loan application fee, etc. Get loan quotations from 3-4 lenders. When you receive the loan estimate, compare each offer and you will clearly see which lender charges more and which one offers a better deal. 

  1. Pay 20% Down payment

To receive a better loan interest on your mortgage, it is advised that you pay 20% down payment of the total home price. This also ensures that you are not going to be stuck for life paying for mortgage insurance.  Private Mortgage Insurance (PMI) is the insurance you pay for your mortgage loan. All borrowers pay PMI, regardless of the down payment paid. However, if you pay 20% as a down payment, you will pay lesser PMI because your terms of payment will be shorter. 

  1. Get a good credit score

Your credit score is inversely proportional to your loan. The higher your credit score, the cheaper your loan. There are few ways to achieve a better credit rating. First is to pay your credit balance on your credit cards. If you cannot zero out the balances, at least keep it below 15% of your credit limit. Check your credit payment history. Make sure all payments are posted with the right date. Then avoid making new credits. If you have a plan to buy a house, hold off buying a new car or swiping your credit card to pay for vacations packages.