One of the life goals of most people is to own a house. Unfortunately, most properties are priced beyond the reach of average income earners. However, it is possible to own a house without paying top dollar. Below are five tips on how to afford a house:
Work on Your Credit Score
Today, your credit score will determine what type of mortgage you qualify for, how much you can get, and at what rate you will be allowed. You will find that the higher your credit score, the lower the rates you will get. The lowest score required to qualify is 620. However, you will get the best mortgage rates at scores above 760.
The difference in the rates at these different scores can be as high as 1.589 %. On a typical $400,000 mortgage, this difference can amount to well over $300 a month. The secret to a cheaper mortgage is to improve your credit score. Some lenders have access to a credit score simulator and can give insights on what measures to take to attain a more favorable score.
Consult Industry Professionals
Seasoned professionals like mortgage planners can help you understand how the industry works and can even help you shop for the best rates. These professionals can be considered “insider,” yet they are independent as they do not work for the lenders. If you are considering a mortgage in West Jordan, City Creek Mortgage says you may want to contact a mortgage lender soon, to get the best deal.
Hunt for Foreclosures
It is not a secret that there are some great deals on foreclosures. The good thing about foreclosures is that they aren’t necessarily beat-down properties. It is not uncommon to get a fairly decent house in a good neighborhood. However, always ensure that you do a thorough inspection before committing yourself because expensive repairs can eat into any financial advantage you may have.
Choose the Less Popular Spots
Forget the hype about owning a property overlooking Central Park or with great views of the harbor. If your goal is to own an affordable home, be ready to make some trade-offs. You will have to be more pragmatic; keep your emotions in the backseat. Transitional areas aren’t the best neighborhoods, but you can get some great deals there. Or you could just choose a quiet little home in the country.
Buying “As Is”
This is where the buyer purchases the house in its preexisting condition and the seller is not liable for any repairs that might be necessary. While major repairs can be costly, most homes are offered at reasonably low prices and do not necessarily have to be in bad shape.
Buying a house does not necessarily have to be a costly affair. You only need to understand how the industry operates.