Buying a home is the ultimate dream for many Americans. But it is not cheap, and that is why it is considered a significant lifetime investment. Due to financial challenges, not everyone gets to own a home. Fortunately, different types of loans are available for people who want to buy homes but cannot afford to pay the entire cost upfront.
A mortgage loan helps finance a property’s purchase if you cannot afford the entire cost upfront. The home you buy serves as the collateral for the loan, and you can pay it in regular monthly installments. The mortgage charges differ from one lender to another depending on their interest charges and the loan term, for example, 30years. The mortgage process is not a short one; it applies to various lenders to be approved for the loan. Various documents needed for mortgage approval, such as bank statements, act as evidence that you can repay the loan.
When you are ready to buy a house and can afford much, you need to look for the best deals in the real estate market. Here are some of the cheapest ways to buy a house.
Find a chain-free property.
Chain-free property or housing is where the seller is not interested in buying new property after the sale. That means your housing deal is not dependent on other buyers who could break the chain of collapse your purchase. This is often common when a couple moves in together and needs to sell one house or inherited property where the owner wants to sell it. Such properties are easier to negotiate because you only deal with the seller, making it easier to buy a house cheaply.
In a shared ownership, you buy part of the house, and the developer owns the rest of the property. So, you pay the mortgage and a small part of the rent of the property part you don’t own. Over time, you continue making payments until you own the entire property. It takes an extended period, but it is cheaper if you want to pay off your house for a more extended period. If you decide to move, you still get your portion of the sale price because you own part of the property.
Short sales refer to property sales whereby the owner is headed for foreclosure. The owner agrees with the lender to sell the home for the current price standing or a loss on the mortgage. But you need a real estate agent experienced in these types of sales to help you out.
Find for sale by owner property listings.
One cheap way of buying a house is to find a property being sold by the owner as they present a potential bargain. The seller does not have to pay the real estate agent commission, so they are not interested in selling the home for more than it is currently worth. However, it is also challenging as the seller may have an inflated price of the house, and you might have to educate them about the trends in the current market.
It is also good to enlist an experienced real estate agent to determine the cheapest way to buy a house.