Buying a home can get expensive, and if you’re like most homebuyers, you probably want to reduce your costs as much as possible.
After all, it’s not just the down payment, closing costs, and other initial expenses you have to worry about. There are also the property taxes, maintenance and repair costs, HOA dues, home insurance, and countless other obligations you’ll have once you’re a homeowner. And if you want to manage those, draining your savings account just isn’t an option.
Fortunately, the upfront costs of buying a house don’t have to be as expensive as you might expect. Here are just a few secret ways you can lower your costs and reduce the financial burden of becoming a homeowner:
1. Shop around for your service providers.
You don’t have to use the first home inspector, title company, surveyor, or moving company you come across. Shop around, compare your options, and make sure you’re getting the best possible rate. Don’t be afraid to negotiate, too — most fees aren’t set in stone, especially if the market is competitive.
2. Ask for a rebate from your agent.
Your real estate agent gets a pretty hefty commission for helping you buy a home (about $6,000 on a $200,000 home). If you know you did a lot of the home-hunting process yourself, you might be able to negotiate some sort of refund or rebate once the deal is finalized. If you don’t already have an agent, look for one who offers these sorts of discounts from the start (just search for “discount realtor” or “rebate real estate agent”).
3. Buy in a more rural part of town.
If you’re willing to buy in a less urban area, you might be eligible for a USDA loan, which requires zero down payment whatsoever. Check the property eligibility map here (under “Single Family Housing Guaranteed”) to see eligible areas in your region.
4. Boost your credit score before buying.
Your credit score directly impacts the mortgage products you’re eligible and, most importantly, what interest rate you receive. The higher your score is, the lower your interest rate will be — and the more you’ll save on your monthly payment (and over the course of your loan).
5. Buy in the off-season.
Spring and summer are the busiest seasons for buying a home. And when demand is up, prices go up with them. If you want a great deal on a property, consider buying your house in the winter — especially around the holidays. These tend to be the slowest times of the year in the industry, so you may just save on other services and fees as well.
6. See if you qualify for down payment or closing cost assistance.
Many cities, states, and even non-profits offer programs that can reduce or even completely cover your down payment and closing costs. Eligibility is usually based on income level and financial need. If you think you might qualify for a program like this, contact your local or state housing department to ask about your options.
7. Ask for seller credits.
Seller credits are funds from the seller designed to help cover your closing costs, and they might be an option if the seller is particularly eager to sell or if the local real estate market is slow. Ask your agent is negotiating seller credits might work in your unique situation.
The Final Word
The cost of homebuying might seem daunting, but there are several ways you can lower those costs and make buying that dream house more affordable. Want more help on the homebuying journey? Get in touch with Premier Nationwide Lending today.
Premier Nationwide Lending is an Equal Housing Opportunity lender. Sponsored by NTFN, Inc. 700 State Highway 121 Bypass, Suite 100, Lewisville, TX 75067 NTFN NMLS 75333.