Buying A Home In Today’s Economy
By Glen McKenzie
The only thing certain about today’s economy is that it is uncertain. While things look relatively stable now, no one can guarantee what the next few years will bring. Fortunately, you don’t have to give up on the home of your dreams because of a fluctuating economy. Here are four steps you can take to make sure your money––and your house––are safe regardless of the state of the economy.
- Maximize your down payment
The magic number for down payments has been established at 20% of the home’s value. Often, though, new homeowners will put down a much smaller amount. If you can’t afford a down payment of at least 5% of the home’s value, you may not be ready to buy a house.
- Get less than you qualify for
It’s best to buy a house that comes in well under your approved mortgage limit. This will keep your mortgage payments from dwarfing your monthly budget. Also, if the economy worsens, you’ll have a smaller mortgage payment each month.
- Pick the right Realtor
Here’s how to find the Realtor that’s best for you:
- Speak to recent clients about their experience with this agent.
- Look online and find out the licensing of your prospective agent and research how long they’ve been in the industry.
- Choose a Realtor who has been recognized for their excellent work. He/she is the one you want working for you.
- Check the current listings under the Realtor’s name. Are they in the same price range as the house you’re hoping to buy?
- Look for red flags
Aside from having a professional inspection done, check for the following yourself:
- A sturdy roof. A flimsy roof can bring expensive repairs. If you don’t mind replacing it, use it as a negotiating point for a lower price.
- Efficient heating and cooling systems. These can be costly to fix and replace and inefficient systems can hike up your utility bills.
- Strong structural components. Don’t be fooled by a fresh coat of paint. Check beneath the surface for strong pipes, wiring and insulation.
- Overall functioning of the home. Try out everything! Open doors, turn on faucets, flick light switches, and flush toilets. If you find any major problems, rethink your decision to buy this home. Don’t mind a handful of minor repairs? Use these as a negotiating point.
If you are looking for information, guidance, and someone to be there for you every step of the way, consider DATCU. We’re local and have over 80 years of experience serving North Texas families.
Don’t forget to call, apply online, or stop by any of our 11 convenient DATCU locations to learn about our fantastic programs on home loans and mortgages before you start your search. We’ll help you get pre-approved so that you’ll be ready to make an offer when you find that dream home. Helping you with the finances beforehand makes for a pleasant and stress-free buying experience.
Glen McKenzie, President/CEO of DATCU Credit Union, may be reached at 866-387-8585.