[ad_1]
Since 2011, the average price of a house in the US has more than doubled — rising from $176,000 in 2011 to $358,000 in 2022.
Though home prices have recently dipped for the first time in more than a decade, inflation, growing student loan debt and high interest rates have made the dream of homeownership more challenging for each generation — especially in a booming real estate market.
But it’s not impossible. We’ll walk you through the process of buying a house step by step.
How to Buy a House: 9 Steps for First-Time Buyers
While the road to buying a house has become more riddled with potholes and speed bumps, it’s still one you can navigate with the right savings plan, a decent credit score and a little professional guidance.
Think you’re ready to embark on your home buying quest? Here’s how to buy a house in nine simple steps.
- Whip your credit score into shape
- Save for a down payment
- Figure out your price range
- Get preapproved for a mortgage
- Hire a real estate agent
- Shop for your dream home
- Make an offer they can’t refuse
- Get an appraisal and home inspection
- Close on your new home
1. Whip Your Credit Score Into Shape
A strong credit score is crucial to securing a low interest rate on your mortgage.
Over 30 years, the most common length of a mortgage, paying just 1 percentage point more in interest could cost you big time. For example, if you bought a house with a $200,000 fixed-rate 30-year mortgage at a 5% interest rate , you’d pay an extra $40,000 in interest over 30 years than you would have at 4%.
At a minimum, your credit score should be 620. Some mortgage lenders may approve you for a loan if your score is under 620, but prepare for astronomical interest rates and larger down payment requirements. An above-average credit score falls within the 680 to 740 range. Anything above 740 will secure you the best interest rates available.
If you have poor credit, don’t rush to buy a house just yet. You can improve your…
[ad_2]
Source link
