With low inventory and high prices, it’s a challenging market for buyers, especially if they’re looking to save money.
But just because the market is competitive doesn’t mean there aren’t ways to save on your home purchase! There are steps you can take to make buying a home more affordable, even in today’s market.
So what, exactly, are those steps?
A recent article from realtor.com outlined strategies buyers can use to save money on their home purchase in today’s market, including:
- Pay down old debt. It may sound counterintuitive, but sometimes, you have to spend money to save money. Using available cash to pay off existing debts can lower your debt-to-income ratio and improve your credit score — both of which can help you get a lower interest rate on your mortgage, which can equal serious savings.
- Shop around for the best rate. As mentioned, the more competitive interest rate you get on your mortgage, the more money you’ll save. The best way to get a competitive interest rate is to shop around. Talk to multiple lenders and see who can give you the best rate and/or the best overall mortgage package — for example, some lenders will waive fees to make their loan more competitive.
- Go with a 15-year mortgage. 15-year mortgages are not for everyone, as they have significantly higher monthly payments. But while upfront costs are higher with this type of loan, they generally have lower interest rates. So if you can afford the payment, you will save a huge amount of money on interest, and pay your home off in half the time of a traditional 30-year mortgage.