How To Save Money When Buying A Home

Buying a home will be one of your largest personal financial expenses. Therefore, it is very important that you invest wisely. Candee Lynn Wilson, Real Estate Agent in Portland, Oregon states that if you're a first-time home buyer, or even if you've purchase a home or homes before, you can discover ways to save a bundle when it comes to buying a home. Below is her 20 ways to save money buying a home.

1. BE CAREFUL AND RESPONSIBLE WITH YOUR CREDIT.

Don’t let little problems turn into collections. It is easier to stay out of trouble than to get out of trouble, especially with the credit reporting system in America.

2. BUY THE HOUSE FIRST, THEN THE CAR!

Houses generally go up in value, while cars go down. Automakers need to sell their excess inventory. You can ALWAYS buy a car.

3. CHECK YOUR CREDIT REPORTS ANNUALLY, AND BEFORE MAKING BIG PURCHASES.

If there is a big mistake on your credit report, you can address the issue before being denied credit. The credit inquiry is considered as a negative event.

4. CLOSE THOSE DEPARTMENT STORE ACCOUNTS.

Get one Visa or Mastercard with a real limit and just use it.

5. STAY BELOW 80% OF YOUR CREDIT LIMIT ON REVOLVING ACCOUNTS.

Credit scores go down dramatically when your balance is over 80%.

6. DON’T BOTHER SENDING IN FOR “PRE-APPROVED” CREDIT CARDS.

As the old saying goes, “If it sounds too good to be true, it probably is.” Again, the credit inquiry is not a positive addition to your reports.

7. DON’T BUY STUFF YOU DON’T NEED JUST TO “RE-ESTABLISH” CREDIT.

Get a secured Visa or Mastercard that reports like a regular card. Use it to buy everyday necessities and deduct the money from your checkbook at every purchase. Pay it off every month.

8. GET YOUR CREDIT IN SHAPE.

Nothing affects your ability to obtain a mortgage more than you credit history (unless, of course, you can pay cash).

9. USE A MORTGAGE BROKER WHO HAS ACCESS TO EVERY LENDER’S RATES.

Mortgage brokers have much more flexibility than banks or svings and loans.

10. LET THE GOVERNMENT HELP YOU BUY A HOME.

FHA, VA, Farmer’s Home Administration, State Housing Loans all have much more liberal underwriting than conventional loans.

11. GET PRE-APPROVED FOR A LOAN.

A homebuyer’s leverage is greatly increased when a seller knows you can afford his home AND can get the financing for it.

12. CHOOSE THE LOAN PROGRAM THAT BEST FITS YOUR NEEDS.

There are hundreds of loan programs. Everybody’s circumstances are different, and one loan program may be better for you than another.

13. ASK FOR YOUR INHERITANCE EARLY.

If your parents are financially capable, don’t be afraid to ask for their help. They will be making an investment in your future -- which is what they have been doing since you were born. They will be able to see their money put to good use.

14. DON’T THINK OF YOUR FIRST HOME AS THE ONLY HOME YOU WILL EVER OWN.

The average homebuyer will have 7 homes in his lifetime. Start with what you can afford TODAY, and work your way up.

15. TRY TO DETERMINE HOW LONG YOU MIGHT LIVE IN A HOME.

Certain loans are more favorable for short-term occupancy. Singles or couples can occupy a much smaller space for a longer time than can a growing family.

16. DON’T OVERLOOK COSMETIC FIXERS AS GOOD BUYS.

Most people want new construction or something that looks new. These are the most expensive homes on the market. If you can see past old countertops, dark wood, gold carpeting, etc., that can all be fixed or replaced -- in time -- there are many good buys out there.

17. DON’T SNUB CONDOS AS A FIRST HOME.

A condo may not be your first choice for a home, but it gives you the same tax advantages as a single-family home, and it gets your foot in the door. If you want to live in a particular area, and a condo is all you can afford, it’s still better than renting.

18. ASSESS YOUR OWN LIFESTYLE.

If you’re a person or family on the move, do you really want to spend your time tending to a large yard when you could be skiing, camping or fishing. Does the thought of housekeeping or home maintenance make you shudder. Your lifestyle should help you decide what type of housing will make you happy.

19. BEWARE OF FATAL FLAWS.

A bad location can’t be changed. Poor floor plans need major remodeling. If the price of a home is too good to be true, it probably is.

20. CHOOSE AN EXCLUSIVE BUYER’S AGENT TO HELP YOU WITH THE HOME-BUYING PROCESS.

An exclusive buyers agent works only for the buyer, never the seller. He/she helps protect your interest in a real estate purchase and helps you get the best price and/or terms.