National data suggests that buyers in many parts of America are enjoying the prospect of paying lower prices, while the Federal Reserve is indicating a reluctance to push rates higher.
And that means once inflation descends, so should mortgage costs.
So, if you are thinking of buying in the near future, it will pay off if you start your preparation work now.
Focus is essential
Many folks can see the likelihood of further rate rises diminishing as inflation edges down. And that means lower mortgage costs. Join the dots, and the market may shed its conservatism in the medium term. Buy in the next few months, and you’ll likely benefit from the upswing when it comes.
Review credit
Your credit score is a key influencing factor on the size of your mortgage, or whether you get one at all. Try to restrict yourself to using less than a third of your available credit, don’t put a much-needed holiday on the credit card and hold off taking out a loan for a new car.
Down-payment challenge
How are you getting the cash together for your down-payment? You don’t need 20% of the loan or property value to qualify. A survey by the website Zillow found 58% of folks who successfully applied for a loan never made that threshold. There’s a price for falling short, though. It’s called Private Mortgage Insurance (PMI).
Know your budget
Don’t search for a property without knowing what you can afford. Set your budget by obtaining a pre-qualified loan from your lender. A “pre-qual”, as it’s known, is a statement of financial support by your lender. It is not a guarantee. A lender may modify its position due to rate rises or its valuation of your desired property.
Make a list
The most efficient buyers are those who know what they want, and they have a list of “must-haves” and “nice-to-haves” to prove it. A list will keep you on the straight and narrow. Countless folks have bought a property and then realized they didn’t tick off a few of their “must-haves”.
Find an agent
Your ideal agent should have experience in the neighborhoods where you want to buy. Ask for references and examples of how they negotiated purchases of homes similar to those on your wish list.