Buying a House in 2020?
Is this year the year you finally purchase the house of your dreams? If so, here are some things you should know first. First things first you need pre-approval from a lender. This will save you a lot of trouble in the long run when you are out looking at homes. You heard me right! The pre-approval will give you an estimate of what you can afford, helping you tremendously with finding your dream home. If you shop before you have a pre-approval you may not realize if there are any sort of deal breakers that will prevent you from buying. These deal breakers can range from issues with student loans to recent cash deposits. So it’s best to get pre-approved first. Also walking into a deal with your pre-approval will give you definite brownie points with the seller. It shows that you are serious about your transaction and if there is one thing a seller is looking for is a buyer who is ready to go.
A good trick for mentally estimating what you could afford in a house s take you and your spouse/partner/companions annual income
together. Multiply that by three and you have the price of a home that should be in your ideal range. This estimate is only for what you could afford in a mortgage not what the lender is lending. Also when you buy a home you definitely need to have your credit score in a certain area. 620 should be the absolute minimum for a score and if you have a score over 740, you’re golden. There can be times that a much lower credit score is accepted so it’s not the one and only thing you should be focusing on but it’s still an important factor in the process.
Currently mortgage rates are lingering around 4% APR. It’s been this way for months so rates this year are favorable right now. They also aren’t expected to go up much at all this year. So since the mortgage APR is so good it is a great time to snag yourself a great deal on rates. Although it may seem that you could take your time throughout this year picking the home of your dreams and slowly scoping it out. I would recommend picking out a house sooner. Rates are steady but that does not account for house prices.
The last thing you should know about buying a home in 2020 is that you do not have to put down exactly 20% to buy a home, that is a myth. Yes 20% down can help you buy a home that you really want, and it can help you put down better offers on homes but, there are people that have put down anywhere from 3% to 6% down and got their offer accepted. If you were wondering, the Average median of 2019 was 16% down. So clearly people are not all putting down 20% so you don’t necessarily have to either. I hope these tips help you find the home of your dreams and if you have any other real estate questions ask one of the agents from the Portland Vancouver Lucido Global Team and they would be happy to help you! Have a wonderful day and find the home of your dreams.