My husband and I were recently blessed to purchase our very first home! After two years of renting and then living in our church parsonage for three years, we were ready to buy a home. If you’ve never purchased a home, or even if you have, I wanted to offer some money saving tips on financing your home.
1. Find a mortgage broker. In my experience, finding a broker first before looking at houses helped immensely in knowing what we needed to do financially to be ready and what our budget would be. If you don’t have a good credit score, a broker can help you know what steps you need to take. If you do have good credit then your broker can help you get pre-qualified for a loan and even lock in your interest rate. Also, shop around for the best interest rate. I ended up switching brokers through this process and saved almost 2% in interest. Over the course of a 30 year loan that 2% really adds up!
2. Make a post-purchase budget. Even if the house has a lower purchase price but needs updating or appliances, it can end up costing much more than a higher priced home. Make a post-purchase budget to ensure you can actually afford the initial purchase, which may include fees or closing costs, payments, and then finally the updates it may need.
3. Determine to make bi-weekly payments. I was astonished when I dissevered the amount of money on interest we would save just by splitting our mortgage into two payments. If you purchase a home for $100,00 with a 4% interest rate, the mortgage payment would roughly be $633. Simply by paying $316.50 twice a month would save you $10,000 and pay off your house four years earlier!
While looking for a new home can be exciting, it can also be overwhelming and downright discouraging. During our house-hunt, we lost a house that I thought was perfect for our family. I was so distraught over losing that home, but God had other plans. The home we actually purchased months later was far better in many ways and was worth the wait. If you’re going through this, or anything else for that matter, continue to trust in God. I promise you, He will not let you down