Cut Costs While Buying a Home with These 3 Methods
You know you’ve finally made it as an adult when you purchase your first home. You worked so hard for years to save up enough money for a down payment. It’s finally a place you can genuinely call your own. You feel like you’re on top of the world and nothing can bring you down.
Until you get your mortgage payments.
Was your house really worth the price? Could you have saved money somewhere along the way on the purchase price? Here are some noteworthy tricks that can help you save money while you’re searching for your dream home.
1. Work on That Credit Score
Before you even think about intending to buy a house, you should work on improving your credit score. One of the keys to getting the best mortgage rates out there is to have a credit score of 701 and up! You can raise your credit score by making your current rent, credit card, car payments, etc. on time. If you limit your credit card spending to less than 30% of your credit limit, that can help as well. There are other methods to raise your credit score, but these are a few basic ways to get started.
If it’s been a while since you last checked your credit score, it’s probably a good idea to do so. Websites like ClickFreeScore can help you figure out what your credit score is on three different reports for free! If you find out your credit needs desperate repair, there are institutions in place to help you fix your score ASAP.
Lexington Law can run a free credit analysis and provide you with the tools and professionals to fix unfair, negative items on your credit report. The HOPE Program specializes in making your credit better for the specific purpose of buying a home. The program can repair credit; add new, good credit; and educate people in local lender and real estate programs.
2. Get a Home Warranty
Writing a home warranty into the contract for buying your new home sounds expensive, doesn’t it?
News flash: typically, it isn’t.
A home warranty is a service agreement good for one year that covers the repairs or replacement of major portions or appliances in your home. Typically, things like your HVAC, kitchen appliances, washer, dryer, roof, plumbing, electrical and more are included in the home warranty, but every contract is different.
Normally, a home warranty only costs somewhere between $300-$500. That’s super cheap compared to how much it would cost to replace some of those big-ticket items! There’s also a good chance your seller will pay for the home warranty, which makes the deal even sweeter!
Getting a home warranty when you buy a home can save you a lot of money down the road from unexpected expenses. It’s well worth it to consider if a home warranty is right for your situation.
3. Do Your Homework
Every aspect of a house and the property it sits on can have consequences on your budget. Have you taken all the aspects into consideration? Things like the ages of the home itself, the appliances, HVAC, roofing, siding, windows can cost you a lot of money to repair and replace in the near future. Will you be prepared if something happens?
Is the basement dry or does water seep in through unknown places? Is the foundation cracked? Does the yard have trees and shrubs that need to be removed? Are their roots growing into the bowels of your home? Do the walls have water damage? Do your gutters not drain properly? Does the backyard not drain properly?
These are all questions you need to ask yourself before you buy a home. Though they’re not the only questions you need to ask, they’re very important ones to say the least. If you don’t ask yourself these questions, you could be shelling out a lot more money than you should be if all these things need repairing in the near future.
A good realtor will be able to take care of many of your concerns about how to save money during your house hunt. But it’s always good to keep these ways to save in mind while you’re in the process of buying a new home.