Are you one of the many people looking to buy a new home in the new year? If so, you're probably trying to figure out where to start.
By following these 10 tips, you'll be well on your way to securing the perfect property for your needs. From getting pre-approved for a mortgage to setting your budget, we've got everything you need to know to buy a home in 2022.
Check Your Credit
Before you can get the home loan you need, it's important to check your credit report for any errors or issues. You don't want an unexpected ding on your credit report to cost you the home you love so much. If there are any inaccuracies, dispute them immediately so they don't have a negative effect on your home financing options. And if you just generally have a low credit score, now is the time to improve it.
Save Your Down Payment
Having a down payment can mean the difference between getting a home loan and having to pay for private mortgage insurance. You don't want PMI weighing down your budget, so try and save up around 20% of the home's total cost before you start shopping.
Start Packing Early
Moving is always more work than you think it will be. Start organizing, decluttering and packing as soon as you make the decision to move. Getting a head start will reduce the amount of stress in your relocation. It will also aid in the preparation of your current home for sale.
Make Home Improvements
Even if it's just painting, home improvements can increase a home's value. Little improvements can make your home more desirable and better able to compete against similar homes on the market. If you plan on living in the home for at least two years, be generous when budgeting for home improvements — you will recoup some of those funds through increased home value upon selling, but it may take time depending on the type of improvement made.
Getting pre-approved for a home loan is crucial when you're looking to buy a home. Having access to potential mortgage options will make your home buying experience go much more smoothly. Speaking with a lender and getting pre-approved will give you a clear idea of how much home you can afford and help you plan your home search.
Find financing options
Remember: home loans come in many shapes and sizes. When it comes to home loans, there is no "one size fits all." Options for home loans include FHA loans, VA home loans, or conventional home loans. And different lenders might be able to offer you lower interest rates or down payment assistance depending on your home loan needs. So shop around for home loans and find the home loan and lender that best fits your home buying needs.
Think about location
Location is one of the most important home-buying factors. You'll need to consider what's most important to you; whether it be near work, close to amenities, or in a school district with a great reputation. Your new neighborhood should feel like home. So spend plenty of time exploring the area at different times of the year. You might even want to plan a weekend stay to really get a feel for the community.
Set your home budget
It's important to set a budget for yourself before you start looking for homes. Your home budget should account for:
- Down payment
- Monthly mortgage
- Inspection costs
- Moving expenses
- Property taxes
- Homeowners insurance costs
- Expenses like unexpected repairs or upgrades if you plan to buy a pre-owned home.
Set a home buying timeline
Now that you have a clear idea of home loan options and home budget, it's time to set a buying timeline. Determine when you'd like to move into your new home and make sure to plan for the time it takes to close, which is usually around 30 days. There could be some overlap between the time you sell your current home and when you buy your new home. So make sure you have allowed enough time before your move-in date.
Choose Your Home Type
Budget, location and your lifestyle needs will all come together to help you choose the right home. If you have a family, think about the amount of space you'll need. A large two story home with a big backyard might be a priority. If you're retired, you might want something a little more low maintenance. Sturbridge Homes builds everything from single family homes to duplexes and townhouses. Explore our move-in ready homes here!