It’s not easy to buy your first home. But it is even more difficult in 2021. For the past two years, inventory has been falling steadily. This is the longest streak in over two decades. The competition for lower-priced homes continues to be fierce as prices continue to rise. These five tips will help you get the best chance of buying your first home buy 2021.
1. Start Saving Now for your Down Payment
Start saving now for your down payment as soon as you decide to purchase a home. You should save every dollar that you can for large sums like tax refunds and holiday bonuses. The 20% down payment for a first-time homebuyer is the standard. Even if you don’t have the funds, some programs allow for payments as low as 3%.
2. Estimate Your Mortgage Payment
Before you begin looking for a home to call your own, make sure you know how much you can afford. Online calculators can help you figure out how much money you can afford. Compare rates from different lenders to find the best terms.
3. 3.Check Your Credit Reports
We are far from the heydays of subprime mortgages. Solid credit is essential to be eligible for a mortgage. However, knowing your credit score doesn’t suffice. Also, you should check your credit reports. If you discover any discrepancies in your credit reports, you should dispute them. You can improve your credit score by avoiding opening new accounts and paying off as many of your debts as you can.
4. Consider which type of home suit suits you prefer.
While most buyers prefer single-family homes, they are not the only option. Townhomes and condos are smaller in square footage but require less maintenance. The attached homes offer additional amenities that are not available to homeowners. If you have pets or children, make sure to review the HOA rules before offering a condo/townhome.
5. Do not forget about insurance and closing costs
You’ll have to pay more than the purchase price when you buy a house. You may also need to pay closing costs such as property taxes, title insurance, transfer taxes, HOA fees, or escrow fees. These costs typically amount to 2-5 percent of the sales price. Closing costs can run up to $13,000 for a $275,000 median home. It can cover these additional costs by putting aside money.
It’s time to buy your first home
You face a difficult task as a 2021 first-time homebuyer. There are few affordable homes, and rising prices mean that properties and properties are selling more quickly than ever before. There is a bright side to this story. Now is the best time of year to purchase before the housing market tightens. These five tips will help you find the perfect home.
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