How to Save Money Buying A Home Today

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By Cinda Roth
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Purchasing a home is likely one of the most expensive things that you will ever do. However, there are some ways to minimize the costs.

Difficulty: Easy

Instructions

Step 1

The first step is to write your 5 year plan. Think about where you are going to live in 5 years. Every time you buy and sell a house you pay significant transaction fees. Where you want to be in five years will determine if you look at homes that you can raise a family in or if you are looking at homes that can easily be used as a rental when you relocate or upgrade your housing.
Step 2

The next step is you improve your credit. This means getting a copy of your credit report. There are several websites that will give you a copy for free with the score. Additionally the credit agencies will typically provide one free credit report a year. Correct any erroneous facts on the credit report.
Step 3

Now look at your finances and determine if you can wait long enough to save 20% for a downpayment. This will often enable you to get a lower interest rate and eliminate the need to spend money on mortgage insurance.
Step 4

Look at school districts. If you need to sell the home in the future then the school district will make your home easier to sell at a higher price.
Step 5

Evaluate all loan options carefully. When you pick a mortgage you typically have the option to pay additional points to lower your interest rate. Look at this carefully. If you plan to be paying the mortgage for 5 years or more it may be beneficial to pay points. However, if you plan to pay off the home sooner than you may want to skip the points.
Step 6

Make sure to do your homework prior to bidding on a home. Your bid should be based on the sales prices of other homes in the area in the last couple months.
Step 7

Be willing to haggle. Offer a price a bit below what you are willing to pay so that you have room to haggle back and forth.
Step 8

Think about creative ways to satisfy the seller for example paying more for the house but asking for the seller to include laundry appliances or take them in exchange for a lower price.
Step 9

Make sure to hire a home inspector to look at the house. This will save you money in the long run by minimizing costly repairs found right after the house closes.
Step 10

Talk to your employer. Some companies may offer low interest loans for some or all of your home costs.
Step 11

Shop around for home insurance. Every company is a bit different. You may consider a higher deductible to minimize your premium.

Comments

missnye said

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on 11/17/2009 very helpful!*****

hnatalieann said

on 11/10/2009 Great tips, we are going through this right now! Great timing! 5*'s

on 11/6/2009 Great tips - especially the one about getting a home inspector to inspect the home. ALWAYS do that! 5* God bless. Make sure it is an inspector that you hire (not affiliate with the seller's realtor). 5* God bless.