Three things you need to do before buying a house in 2020
Another year, another decade. Things change – we grow older, we get married, we have kids, or we watch them move out. So much can happen. If 2020 brings with it major life changes for you, you might even see yourself needing a new house. But before we start our search, there are a few things you need to take care of first.
Know your credit
Do you know the absolute worst time to find out what your credit score is? When you go to make an offer on the house of your dreams. It’s important to know your credit score before you walk into your first open house, and make sure it’s good enough to get a great mortgage rate. You want a credit score above 650, or ideally, above 750 to get the best rates.
Not quite there? Not to worry. There are many things you can do to raise your credit score. The most important is to get a copy of your report and correct any errors. Keep your credit card balance to under 30% of your limit (raise your limit and pay off some debt to get it there) and use your credit card regularly. Make sure you pay your bills on time and you’ll raise your credit score in no time.
Know your limit
It’s best to know what you can afford before you start house hunting. There are few things in this world more disappointing than falling in love with a house that you later find is wildly out of your price range. If you know your maximum upper price range, you’ll be better able to make hard decisions. If you know what your comfortable upper price range is, you’ll be able to make decisions that will leave you with a lot less stress.
Once you know what you can afford, you can work on being pre-approved for a mortgage. It will make your shopping much less stressful.
Know your deal breakers
When you begin to look at new houses, you’ll have a whole list of “must-haves,” “can’t-haves” and “would-be-nices.” Those are important and they help your real estate agent (hi!) filter your search to better suit your needs.
But at some point, if your lists are long, you’ll need to figure out what things you can’t budge on. Do you absolutely need a fenced yard? Is the area more important, or the number of rooms? Are you okay with some renovations if it’s walking distance from your favourite wine bar? Figuring out your priorities will help you be flexible without making concessions you will regret later. It gives you and your agent better parameters to find the perfect place for you, but enough flexibility to know when you are just a few minor tweaks away from your dream home.
2020 holds a lot of promise. If this is the year where you will become a homeowner, make sure you put in the work now to make everything else easier later.