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Date Archives: January 24th, 2023

January
24

Achieving 2023 Home Goals - Badger Peabody & Smith RealtyForget everything you've heard about buying a home in the last two years. The housing market in 2023 is going to be an entirely different affair. Some experts are predicting a more balanced market. But that won't necessarily make homeownership more affordable as interest rates are on the rise.

So, what's a savvy first-time buyer to do? Here are some tips from our real estate agents that will help you bring your homeownership goals to fruition.

  1. Add to Your Down Payment
    Generally speaking, a larger down payment means a lower mortgage rate. One thing to understand is that interest rates are all about risk—they represent the potential for investment losses. For this reason, paying more cash upfront makes you less of a risk to lenders as you have more stake in the property. As such, they are likely to offer you more favorable interest rates.

    Ideally, you want to save enough money for a 20% down payment. But lenders will seldom ask for this much, especially if you have a solid credit score and an excellent debt repayment history. That said, the more you put down, the less you'll pay over the life of the loan.

  2. Make Sure You Have a Great Credit Score
    Here's an industry secret: You don't need a great credit score to buy a house. But it will be harder and more expensive to do so. Your credit score is a crucial deciding factor when applying for a mortgage. See, your credit score isn't just some number. It tells the story of how reliable you are as a borrower and how well (or poorly) you manage your money. Your credit score is yet another metric financial institutions use to assess the risk of lending you money. Typically, the higher your score, the less of a risk you are and the better your borrowing terms will be.

    Considering interest rates are on the rise, it's certainly wise to take measures to improve your credit score. Paying your bills on time and keeping your credit utilization low are just a few ways to do this.

  3. Shop Around for the Best Mortgage Rates
    Getting preapproved before you start house hunting is always a good idea. But remember, dealing with only one lender may not work in your favor. You'll want to shop around and compare interest rates from different lenders. This way, you'll secure a lower rate and even better terms on your mortgage.

    What's more, you may want to consider getting a fixed-mortgage rate. Adjustable-rate mortgages have the advantage of lower interest rates, but they can be more expensive long-term in a market where interest rates are on the rise. A fixed-rate mortgage, on the other hand, offers a consistent monthly payment for the duration of your loan, making it easier to budget.

  4. Consult a Local Professional
    There's a lot of talk about interest rates on a national scale. Bearing that in mind, your local real estate agent is well-versed in your area's current trends, neighborhood characteristics, and the local economy. Such in-depth knowledge can prove invaluable when it's your first time around the block. Whether you want to tour Berlin homes for sale or Bretton Woods homes for sale, your local real estate agent can help you out.

Find the right home for you this year around the White Mountains of New Hampshire. Contact us to learn how we can help you navigate the 2023 real estate market.

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