5 Ways to Save on Your Next Home Purchase
Your next home purchase is an exciting time. It’s a big decision that can have a huge impact on your life for years to come. So, it should be fun and exciting! Well, it can be if you do your research first. Here are some tips to help you save money when buying your next home.
1. Find the real estate agent with the best sales track record.
Choosing the right real estate agent is key for buying a home. They'll be your guiding light through all of the paperwork, negotiations and inspections. If you choose well, they can save you money on everything from repairs to closing costs. So how do you go about finding one?
To start with, look at their track record. Find agents with a good track record of homes sold in the past year—you want someone who has an established client base and experience negotiating deals with sellers. How many homes did they sell last year? What was their average selling price? How much did they save their clients in terms of fees, closing costs, or home inspection negotiations?
2. Negotiate commission, fees, and contract terms with real estate agents.
Negotiating commission, fees and contract terms with a real estate agent is a great way to save money on your next home purchase.
First, compare the agents in your area to find out who offers the best deal. You can do this by using sMover.
Once you've found an agent that fits your needs, ask them about their commissions and fees. Many will negotiate with clients a reduced commission.
You may also want to ask about other contract fees and terms. You're the boss, and hiring an agent to help you, so make sure you know exactly what you're getting. It could end up protecting your best interests and saving hundreds if not thousands in commissions, fees, or costs.
3. Compare lenders and loan terms.
When you're ready to start looking for your next home, compare lenders and loan terms. Getting pre-approved for a mortgage is really the first step to knowing how much you can afford and what your monthly payments will look like.
The percent of the sales price you put as down payment is another important factor to consider when comparing loans. Most lenders have loan products ranging from 0% down payment to 20%+. It's always good to talk with a local lender and to get multiple opinions on your home loan.
The best way to do this is by simply taking some time with each lender to review their pre-approval letters and have them explain their fees, costs, and rates.
4. Negotiate the price and terms of the sale.
It’s easy to think of a home purchase as a one-way street. You pay the asking price, you get the keys and call it a day. But there are other ways to save money on your new home—and one of them is knowing how much room for negotiation you have with potential sellers.
In addition to negotiating on price, there are other ways in which you can negotiate with sellers before making an offer:
Consider offering less than asking price
if you can get lower closing costs or inspection findings in return. For example, if the inspector finds issues that will require expensive repairs but all parties agree that these costs should be covered by the seller instead of buyers, ask for these fees (or at least some portion of them) as part of your initial offer. This can help lower your overall mortgage payment and save thousands over time!
5. Negotiate closing costs with the seller.
Negotiating closing costs with the seller can save you thousands of dollars. Closing costs are the lender, title, taxes and other fees that are paid by you at closing. They typically range from 3-6% of your sales price.
If negotiating a lower sales price isn't possible, there is another option: negotiating these fees to be paid by the seller instead of you!
As you can see, there are many ways to save money on your next home purchase. You may even be able to negotiate a lower price with the seller if you offer to pay some of their closing costs. Remember that real estate agents can also help you find a lender who will give you a better deal on your loan terms—this way, not only do they get compensated by both parties but so do you!