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If you’ve been thinking about making a new home purchase, then you’ve probably heard some of the horror stories from headlines or fellow home shoppers about the current house purchasing process. With a perfect storm of circumstances leading to an extreme seller’s market, and no end in sight for 2022, it’s more important than ever to have a strong strategy in place for a successful house hunt. As one of the top 3 title and settlement agencies in the DC Metro region, we’ve compiled your “must do’s” to ensure you don’t waste your time or money when beating the odds securing your next home.
Check your credit score and do not use your credit card. Before you start applying for mortgage pre-approval (more on that later), check all three of your credit scores to make sure there are no issues or errors. Correcting these may take some time so do this early on in your home shopping process to leave you with plenty of time to fix. Also, excess spending and credit card debt will lower your credit scores so time to put the plastic away for now.
Get pre-approved for a mortgage loan. This is going to help set your budget for how much you can spend on your new home. Once you have pre-approval in your back pocket, real estate agents will be more willing to work with you knowing you are prepared should you find the right property to make an offer on. And in today’s fierce sellers market, this is a crucial step in the strategy to ultimately win your dream home.
Prepare to buy a fixer-upper. With limited inventory, potential homebuyers can’t be too picky. Stay open-minded to options in the perfect neighborhood or close proximity to schools or places of work, that might need some updates and renovations. These additional costs will need to be factored into your overall purchasing budget as well.
Don’t assume you can’t negotiate. Despite sellers having most of the power in a purchase negotiation right now, there is still room for you the buyer to get some of the things you want and or/need out of the contract. Use the inspection process to your advantage, identifying what things need to be fixed before you take possession of the property and how the seller will compensate you for it. Can they offer a credit in closing costs or even a discount in purchase price?
If possible, consider buying later in the year. Before you jump headfirst into the housing market today, consider the “seasons” of the industry. Typically spring is the busiest time to buy and sell, and with the strain on inventory, this will likely drive prices up. Add the fact that mortgage rates are usually at their highest during this time period, and you might want to hold off until the summer slow down. However, bear in mind interest rates may rise as the year progresses which will affect what you can afford.
While it won’t be easy, it is still possible to find your dream home in 2022. Being prepared mentally and financially for the challenges ahead will put the odds in your favor for a successful home purchasing experience. And once you’ve locked in the home of your dreams, let Champion Title guide you through the settlement experience worry-free. For more information visit our website at www.championtitle.com or call us with questions at (703) 444-4100. Happy house hunting!
