bigstock-African-American-family-celebr-14087630While some of us may be prone to spontaneous bouts of spending or find ourselves unable to stick to a strict budgeting system, when it comes to buying a home, it’s important to remember that such a large financial decision warrants more than a few helpings of discretion, sensibility, and budgeting.

With that being said, it’s important to stay on the right path, especially if financial discipline remains a challenge for you.  Therefore, the following tips will help you keep your eye on the prize.

KEEP SCORE: Plain and simple, the better your credit score, the better your mortgage terms will wind up being when it comes time to apply for a loan.  While improving a depressed score may take a good deal of work, a good credit rating can literally save you tens of thousands of dollars over the life of your loan.  Therefore, start by reviewing your credit a few months before you intend to place your loan application and if your score is in the 600s or lower, along with making consistent on-time payments, try to pay down your balances so they sit below 30% of your limit.

CONSIDER ALL COSTS: Sure, the cost of the home itself is a great starting point, but it’s important to factor in all of the other costs of homeownership, such as taxes and insurance, as well as other expenses such as utilities and homeowner association fees.  With that, don’t forget about the ever-necessary rainy day fund which will help you cope when various issues demand repair and go into the process with the understanding that the average homeowner spends 1-4% of a home’s value on property maintenance each year.

BE FLEXIBLE IN YOUR SEARCH: In our culture of instant gratification, it can be a little difficult to distinguish between wants and needs, but in order to make a sensible housing decision, making the distinction between the two is imperative.  When it comes to building your list of must-haves, include items that will directly affect your quality of life, such as the home’s location, its price, the number of bedrooms, and the its square footage.  While you may have your heart set on hardwoods and granite, it’s important to prepare yourself for life’s necessary concessions so that you can remain flexible and stay within your budget.

KEEP YOUR COOL: Purchasing new things is exhilarating for everyone; however, buying a home is not like getting excited over a new pair of shoes.  Using a bit of self-restrain will not only prevent you from overspending or choosing a home that doesn’t fully meet your needs, but it will protect you in markets where the homes are selling quickly.  Even if you have your heart set on someplace you thought would be perfect, be prepared to walk away if the home inspection reveals more defects than your able to deal with.  With this, maintain a sense of calm if you find yourself in the middle of a bidding war, as it can push you to spend more than is prudent.  At the end of the day, maintaining a sense of patience will help you remember that whether your offer is accepted or the home inspection goes off without a hitch, there are always other great homes available.

Marie Dinsmore | The Dinsmore Team | www.dinsmoreteam.com | 770-712-7789