Post from MilitaryByOwner
Compared to the explosive real estate scene that plagued homebuyers over the last couple of years, you might find it a little more feasible to buy a home soon. But, of course, this heavily depends on your location — remember, there’s still a vast shortage of available homes across the U.S.
The good news is that you won’t compete with as many cash offers and bidding wars, and you could see homes for sale linger longer on the market, maybe even with a reduced price. However, the bad news is that you’ll probably pay more over the long term, thanks to increasing interest rates.
You’ll definitely need to put in the time and effort to find a home you’ll love, but with the help of an experienced real estate team and a heavy dose of flexibility, you can increase your chances for a successful house hunt.
Take advantage of these five tips to help you build your home-buying strategy.
1. Assemble a Trustworthy Team of Real Estate Professionals.
House hunting during a period of low inventory and climbing interest rates is no time for investing in your future without professional help. So before you do anything more than scroll home advertisements, ask trusted family, friends, co-workers and neighbors for real estate agent and mortgage lender recommendations. Military buyers and sellers are passionate about their real estate pros, especially if they’re veterans or military spouses, so you shouldn’t have any trouble finding the perfect match.
2. Expand Your Neighborhood Search.
One of the first things your agent might suggest is to widen your radius of acceptable zip codes, cities or neighborhoods. With so few homes on the market, it’s wise to at least consider homes for sale outside of your perfect location. You don’t want to miss out on a fabulous property just a few miles away from your favorite locale. But if location is your top priority, let your agent know early, so they can plan their strategy according to your needs.
3. Reconsider Your Preferred Housing Type.
If your location is non-negotiable, your agent may ask you to consider living in an alternative housing style — like a townhome instead of a single-family house. If you buy a townhouse, condo or duplex, you might get a lot more than a less desirable single-family home can offer, such as square footage, garage space and a homeowner association (HOA) that manages the exterior and lawn service. Ask your agent to highlight the pros and cons to help you decide.
Also, take a look at your preferred amenities and features and think about re-prioritizing. Can you be happy with a single-car garage instead of two? Will three bedrooms plus a bonus room work instead of your preferred four-bedroom home?
4. Look for Alternative Financing.
Although the VA loan is a tremendous benefit, it’s not the only financing option. An experienced lender will look at your finances and suggest alternatives that could make it easier to qualify for multiple loans or have more affordable terms. Bring up the potential benefits of Federal Housing Administration and U.S. Department of Agriculture mortgages with your agent and lender. Some conventional mortgages might be attractive if you have a substantial down payment.
5. Consider a VA Loan Assumption.
On the other hand, a VA loan assumption could be the perfect solution if the home-buying stars line up in your favor. VA loan assumptions are popular as interest rates increase, because as the person assuming the loan, you take on the existing loan’s balance, the interest rate and the monthly mortgage payments.
Assuming isn’t always the 100% solution, however. For example, not all VA loan lenders allow a transfer, and you’ll also have to pay a funding fee of 0.5% of the loan balance unless you have exemption status. If you’re considering a VA loan assumption, make sure your lender has experience with this situation and spends time explaining the many details of the process.
6. Get Creative with Your Funding.
You should have plenty of conversations with your real estate team about how to fund your home-buying dreams. Discuss federal, local, state and nonprofit down payment assistance programs. You could be eligible for money in grants and loans if you meet specific borrower requirements, like veteran status or being a teacher or health-care provider. Read over downpaymentresource.com for out-of-the-box funding opportunities.
If homeownership is your dream, part of your retirement investment plan or simply the solution for a stable home life, it is possible to find and buy a house. Arm yourself with professionals who have your best interest at heart and educate yourself with solutions that will have you painting and furnishing your new bonus room in no time.
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