The Top 3 Compromises Buyers Should Be Willing to Make - Considering the current state of America’s housing market, you probably don’t think that you should have to make any compromises as buyer. However, you’re wrong! Just because conditions tend to favor buyers right now doesn’t mean that you don’t have to compromise – either with the seller or with yourself. In fact, if you want to wind up getting the very best deal, you need to consider making these 3 compromises before you sign on the dotted line:
1. Giving up big nights on the town
This may seem like an odd compromise to make, but stay with me! Think about it – if you’re going out to dinner all the time or meeting your friends for drinks a few nights a week, how much money are you going to be able to put aside for your down payment? How long will it take you to save up 20% to put down? Think you don’t need to put 20% down? Think again! Oh sure, there are mortgages out there that will let you get away with putting down a lot less, but odds are they’ll make you pay private mortgage insurance (PMI) each month instead. In the end, it can actually be cheaper to pay the down payment, rather than to be locked into PMI payments for the next 15 or 30 years. And, your down payment counts towards building equity, while your PMI payments don’t. Even if you find a loan that doesn’t require 20% down (and won’t require PMI), you may have to offer more than the asking price – and that’s something you won’t know until it happens. In fact, with inventories sitting at incredibly low levels in much of the country, buyers are having to offer more than they originally counted on. So, give up those trendy nights out for now. Then, when you’re a big, fancy homeowner, you can work them back into your budget. Won’t it be worth it?!
2. Broaden your search
You’ve got your heart set on a certain neighborhood, but at least consider other areas. You don’t necessarily have to move there, but you owe it to yourself to take a look. Consider it a potential compromise. Why on earth should you do this if you already know exactly where you want to be? With all of the deals floating around in today’s market, you might find better bang for your buck a few miles away. Or, if you live in an area that’s prone to bidding wars (like Southern California, Washington D.C., Seattle, and South Florida), you might get out-bid in the neighborhood of your choice – and need a backup that you can actually afford.
3. Look for a variety of different lenders
Consider this to be compromise on your free time – at least for a little while. Sure, you’d much rather be watching the big game, reading a book, or taking a nap than researching lenders, but the time you spend doing your homework is time well-spent. After all, what if you go with the first lender you find – only to discover that they’re a sea of frustrating red tape or that they won’t sign off on a mortgage for 8 or 12 weeks? Are you willing to wait that long? Most buyers (and sellers!) aren’t. The last thing you want is to lose the home of your dreams because your lender is a nightmare! Just by doing some research, you may be able to find a lender who’s willing to make your life a whole lot easier!
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