5 Things You Should Know When Making a Move

There are a lot of complicated dynamics when it comes to making move. Here are 5 things many people aren’t aware of.

1. You can potentially buy BEFORE you sell

2. You don’t have to put 20% down

3. You can get a better interest rate

4. Not every home is on Zillow

5. Save on cash out-of-pocket

Let’s explore them now….

1. You Might be Able to Buy Before You Sell

For current homeowners looking to buy a new home while leveraging the equity in their current one, there’s an effective solution: The program allows you to secure your next home before listing your current one, streamlining the process and reducing the rush associated with simultaneous buying and selling.

It involves four simple steps:

1. Get approved for the program (call us)

2. Start Shopping

3. Buy your new home

4. Sell your old home

Taking advantage of this program often results in more favorable deals on both the buying and selling sides. Give us a call to learn more about this program, including associated costs and timelines.

2. You don’t necessarily have to put 20% down

A common misconception in real estate is the belief that a 20% down payment is necessary. In reality, there are so many different options available to buyers. Here are a few:

· 3% Down Payment – Conventional

· 3.5% Down Payment – FHA

· 5% Down Payment – Conventional

If you currently have a 5% down payment available, it might be wise to consider purchasing sooner rather than later, as waiting to save an additional 15% could mean higher home values. It’s worth noting that a down payment below 20% typically incurs private mortgage insurance (PMI) costs, which can to your monthly payment. To determine your comfort zone for payment and down payment, utilize a mortgage calculator or consult with a lender.

3. You can get a better interest rate

Your interest rate significantly impacts your monthly mortgage payment, and optimizing it can affect your overall purchase price. Here are several methods to help you secure the most favorable interest rate:

1. Shop with multiple lenders to compare offers.

2. Consider Adjustable Rate Mortgages (ARMs), which now differ significantly from their pre-2008 reputation.

3. Explore the “2-1 Buy Down” program, where your interest rate is reduced by 2% in the first year and 1% in the second year before returning to the standard rate.

Although not suitable for everyone, the “2-1 Buy Down” can lead to substantial initial payment savings, especially when negotiating with the seller to cover the rate buy-down costs.

4. Not every home is on Zillow

Major real estate websites like Zillow, Redfin, and Realtor.com source their property listings from the Multiple Listing Service (MLS), meaning they share the same data. However, numerous properties may be available for sale but aren’t yet listed on these platforms. To stay informed about such homes, maintain open communication with us.

We can only help if we know what you’re looking for. Here is an easy way, if you’re not already working with us. Go to search.improtateam.com and create a ‘Saved Search’. This will tell us what areas you’re looking in. If we find off-market homes that fit your search, we’ll send them over!

5. Save on cash out-of-pocket

An often-overlooked aspect of the home buying process is “Closing Costs,” which encompass various fees associated with transferring property ownership. You can sometimes negotiate with the seller to cover some or all of these costs, which typically amount to 1-3% of the total sale price. This approach can be particularly advantageous when making a minimal down payment, as it eases your financial burden.

While many perceive the best deal solely in terms of purchase price, numerous other elements contribute to a successful transaction. These strategies are among the ways we assist our clients in securing optimal deals. If you’re interested in delving further into these strategies, consider scheduling a strategy session with us.