Before you even begin your home search or hire your Millburn-Short Hills real estate agent, you need to make sure that you have a plan for the financial aspect of the transaction. Purchasing a home is a rather large investment, so if there is any time to start planning your finances, this would be it. As an expert in the Millburn-Short Hills real estate industry, I have worked with several lenders and know exactly what financial documents need to be in order before a successful home sale. My many years of experience as an agent have allowed me to help several home buyers create a financial strategy of their own. Here are some tips and strategies that will help you figure out your budget BEFORE you start your Millburn-Short Hills home search:
• Ask yourself these questions: How long do I plan to live in this house? Where do I see myself in five or ten years? Do I have to or want to make home improvements? Do I want to keep cash on hand for other investments? Can I take financial risks? Do I want to be debt free?
Is your head spinning yet? These questions might seem difficult to answer, but they’re also imperative to figuring out your loan options and financial philosophy. They force you to consider your long-term future and plan your finances accordingly. A house isn’t just something you can easily return after you buy it; it’s a large investment that you will want to maintain for a long time. It’s imperative that you know the answers to these questions before continuing your search for the perfect Millburn-Short Hills home.
• Use mortgage calculators. It’s important to figure out your month-to-month costs for various mortgages before settling on the right mortgage loan and picking the right price point for your home. It also helps you figure out how much you’d have to pay in various scenarios.
• Shop around for the best rates. Don’t accept the very first loan offer you get. Go to a few different lenders and see what the best rates are. You need to figure out the best deal for your financial situation and your family, so explore a few different options before settling on one.
• Lower rate or higher rate? Are you willing to pay for points to get a low interest rate, or would you rather keep closing costs down by taking a higher rate? This is a key decision that needs to be made for your mortgage loan, so consider it carefully.
• Create your perfect loan. Be a little flexible. Combine features of different loans to create one that you are most comfortable with. It’s also important to have a loan that still allows you to accomplish your long-term financial goals, so do your research, consult an industry expert and figure out which options best fit your situation.
• Don’t forget about your other costs! Many times, Millburn-Short Hills homebuyers get so caught up in what the mortgage will be that they forget to factor in their other costs! Don’t forget about your homeowner’s association fees, property taxes and insurance coverage when embarking on your home search. Believe it or not, the costs of these items can take you from one price point to another, so make sure to factor them in to keep your search limited to affordable properties.
• Ask about alternative loan terms. Everyone has a unique financial situation, and as a result, there are many unique loan options to fit each situation. Ask about lesser-known loans, such as 20-year options. These loans do exist, they’re just not as publicized by lenders. Don’t be afraid to ask your lender for some alternatives. This could help you to find the best possible loan for your situation.
If you’re overwhelmed by having to consider all of this information, don’t be! As an experienced Millburn-Short Hills real estate agent, I have become knowledgeable in several aspects of home financing, and I also have relationships with several local lenders that can help you figure out your next loan. Using this information to build a financial strategy will help you avoid financial difficulties and unforeseen costs when you begin the search for your Millburn-Short Hills home.
If you have any questions about what you need to buy a home in the Millburn-Short Hills area, or you want the name of a lender in the area, don’t hesitate to contact me! I’m available to help you at any time you need me, and I’d love to answer your questions. I hope to hear from you soon!
Elaine Pruzon
Coldwell Banker Residential Brokerage
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