Don't Pay Too Much

Every new home buyer worries that they will pay too much. This concern is merited, especially if the buyer has not done the necessary research or is working without a Realtor®. However, there are some steps that can help the buyer save money. 

Negotiation is important in a real estate purchase and is easier if the buyer is prepared. A prepared buyer knows what they need, want and can afford, based on the pre-approval process. Requesting a written Comparative Market Analysis (CMA) and a home inspection in advance will also help the buyer. A CMA lists other homes in a neighborhood that have sold and their selling price, as well as current homes for sale. A home inspection provides the buyer with a written report of the condition of the house and disclosure of needed repairs. Both of these documents help the buyer determine the reasonable selling price of a property. 

For the initial investment, a buyer may request that the seller pay some of the closing costs or ask someone to “gift” the money. Shopping around on home insurance and choosing a loan that requires a low down payment can also reduce up-front costs. 

To reduce monthly payments, a buyer may look for a loan without monthly mortgage insurance premiums. Finding out what is tax-deductible, such as interest payments on a primary residential mortgage and choosing an adjustable rate mortgage minimize monthly payments, as well. The buyer should try to lock in a low interest rate about a month in advance.