Prepare for a home purchase next summer

Although it’s fall, you’re already thinking ahead to summer. Not because you’re about to enter into three months of winter (except in California, where winter is an extended fall) but because you’re thinking of buying a home at that time. If so, here are some things you can think about now before the New Year:

Save for a down payment

The more cash you have saved for a down payment, the more likely you’ll be able to get approved for a home loan from a mortgage lender. Having 20 percent of the cost of the home upfront in savings – with an additional reserve ready if needed – gives you greater financial flexibility over how much you can borrow. This may be crucial if you find yourself in a bidding war with another homebuyer for a home.

Start scoping areas now

Think about the things you want in a location of a home. Do you want your children to attend school in a certain area? Is a location close to the freeway more important than a downtown residence? Do you want to live in the suburbs or do you prefer the city? Wherever your home search takes you, keep in mind that property values will fluctuate, sometimes greatly, based on your location.

Prepare for a possible bidding war

Just because a house is listed at a certain price doesn’t mean it will actually sell for that price, especially when there are multiple buyers interested in the property. When a bidding war begins, sellers will listen to offer after offer, waiting to see which buyer will offer the highest price. It’s straightforward business.

Such scenarios, however, are tough for people who have only a little wiggle room in their budget to increase their offer. This is where having the extra money saved can help you raise your offer so that the seller accepts it.

Do you need more insight on the Real Estate market before you make the big leap? Our friendly mortgage loan consultants can guide you through the process, step by step. Visit our Real Estate page to learn more.

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