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BUYING IN THE AGE OF COVID-19
COVID-19 is having a major impact on a lot of peoples home buying decisions. Many who were intending to buy are rethinking their plans in light of the pandemic. Even though buying a house may be a bit more challenging now, it is still doable.
The advantages
One major advantage of buying a home right now is that the mortgage interest rates are historically low. Making a purchase now and locking in a low interest rate puts a buyer in a better position than renting where rents might go up.
If you are looking to buy a house, condo or co-op, here are some things we recommend in order to help you make the best decisions going forward.
Take a good look at your personal financial situation. Determine for yourself whether now is a good time for you to buy. Consider, is your job situation and income stable? Are cutbacks and layoffs a possibility? Is the stock market a major concern for your finances and purchasing decisions?
It would be wise to take a wait-and-see approach if your own financial future looks unclear. Or think about buying a home for less than you can afford so you’d be better prepared to handle any personal financial downturn in the near future.
Know your situation
Carefully consider how much home you can afford and err on the conservative side. There are many tools, including online home affordability calculators, which will help determine monthly mortgage payments. Compare the projected monthly mortgage to your current rental payments to help determine if it’s worthwhile.
Check your credit score which is one of the main items mortgage lenders review to determine an individual’s creditworthiness. These scores are a major factor in determining the mortgage interest rate the lender will charge, which could make a significant dollar difference in monthly payments.
This is a time to be careful with your credit
Avoid major purchases or changes to your finances. This is not the time to buy a new car or expensive furniture, apply for a new credit card or co-sign on a loan. Those transactions could lower your credit rating, lowering the amount of loan you qualify for or increase the loan interest rate lenders will charge you, or both.
This should shed some light on the initial steps you should take when looking to buy a home. We will go further into this topic in upcoming issues. If you have any questions or comments, feel free to contact me at [email protected]
Next we’ll go to
Next, you need to secure a mortgage pre-approval. A pre-approval shows how much a lender will loan you and assures sellers that you’re financially capable of buying a home. Now that you’re in position to make an offer, lets start looking.
