Given the ongoing fluctuations and uncertainties in the housing market, trying to time when to get a mortgage often requires more luck than skill. Real estate experts typically suggest buying the home that is right for you and your needs—and stay there for at least five years—rather than timing the market.
Nonetheless, there are still steps you can take now that will put you in a stronger position when you are ready to shop for a mortgage.
Take the time to study and understand the market, and be sure to research a variety of loan types.
Here are some other ways you can be proactive:
- Understand your credit score. See if there are ways to improve your credit score. If you can raise your score, it will help you get a lower mortgage rate which means lower mortgage payments.
- Meet with lenders. Getting to know lenders and what loans you potentially qualify for will put you in a stronger position once you are prepared to purchase a home. Shop around online, by phone or in-person at a branch location to find the best mortgage lender for you.
- Review your financial situation. Review your monthly debt payments against your usual income to determine a comfortable monthly payment amount so you know how much home you can afford. You may discover you have to expand your search to locations with lower home prices.
- Use a mortgage calculator. Once you have a sense of the types of loans you qualify for, calculate your estimated monthly payments, punch in your numbers into calculators such as a 30-year fixed mortgage calculator, 15-year fixed mortgage calculator, FHA loan calculator or mortgage amortization calculator.
- Manage your money. Use this time to save money toward your down payment. The more you can put down on a home, the smaller the loan you will need and the less you will pay overall for a mortgage.
About Danielle Verboski