REAL ESTATE NEWS!! What you need to know about saving for a home in 2024!
If you’re in the process of planning to buy a home, understanding budgeting and saving might seem daunting, but it doesn’t have to be. To alleviate concerns, it’s crucial to grasp some of the upfront costs, and for that, relying on trusted real estate professionals is essential. They can assist in crafting a plan and conducting a strategic assessment of your budget and process before you initiate the home-buying journey.
Consider the following aspects, as recommended by experts:
While saving for your down payment is a primary consideration when buying a home, the notion that a 20% down payment is universally required is a myth. Your specific situation and home-buying goals determine the right amount. Collaborate with trustworthy real estate professionals to explore various loan types and down payment assistance programs, gaining clarity on each requirement and optimizing your approach.
Budgeting for closing costs is equally vital, encompassing fees and payments distributed among the parties involved in the transaction. Closing costs typically range from 2 to 5 percent of the mortgage amount. Consulting with a reliable lender will provide insights into the specific costs you need to prepare for at the closing table.
Earnest Money Deposit (EMD):
For added security, consider saving for an earnest money deposit (EMD), a demonstration of good faith when making an offer on a house. This deposit, usually 1% to 2% of the total home price, is not an extra expense but a portion of your upfront costs. It showcases your commitment to the seller, and if the offer is accepted, the EMD funds contribute to the down payment and closing costs.
Remember, an EMD is not obligatory, and its presence doesn’t guarantee offer acceptance. Collaborate with a real estate advisor to determine what aligns with your situation and any local requirements. They will guide you in making informed decisions throughout the buying process.
In conclusion, being well-informed about the expenses you need to anticipate is crucial when purchasing a home. Partner with a local real estate advisor to benefit from their expertise and receive guidance at every stage of the buying journey.
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