Simple Ways to Save Thousands of Dollars Buying Your New Minnesota Home

Whether you want to buy a Minneapolis home or a St Paul condominium, whether you're looking for a golfcourse condo or a Plymouth MN luxury home, the first item on most people's agenda in today's economy is how to save money or find the right down payment assistance. That's why we offer free real estate classes for MN homebuyers.

• The money you will have to pay to get into a home, usually referred to as closing costs
• The money you will have to pay for the home itself or its purchase price
• The money you will pay monthly to repay the mortgage.

Closing Costs:

• The down payment
• Loan-related fees
• Prepaid fees
• Government fees and taxes
• Title insurance and the closer's fee

• Take out a loan with a low down payment such as FHA or Bank of America's CreditFlex. Your down payment will be about 3.5-5% of the purchase price.
• Purchase your home at the end of the month. The amount of prepaid interest on your loan is the lowest at this time and can reduce your closing costs by hundreds of dollars.
• One form of down payment assistance is to ask the seller to pay a portion of your closing costs. This form of alternate down payment is commonly done nationwide and most sellers will oblige if you compensate them by a slightly higher price on the home.

Purchase Price:

• Time your purchase to coincide with the slow real estate time of the year. From November 1-January 15 is the slowest time. Although there may be somewhat fewer homes on the market, there are many fewer buyers. The sellers who list during this time are motivated to sell and often will offer a discount off the published price in order to sell the home.
• When you see a home you like, act quickly. Avoid getting into competitive bidding situations in which you will be paying more than full asking price to get the house. If you wait on the purchase, the chances are greater that someone else who has seen the home may write an offer at the same time as you.
• If you are handy, consider buying a home with dated décor. If the home has a great location, a great interior layout but needs massive updating, chances are it will sell well below its market value. If you are willing to strip wallpaper, repaint and recarpet or lay other new flooring, you will add instant equity to the home and save a lot on the purchase price. Don't do this, however, if you don't really want to do the work. It will be harder for you to sell a home like this if you don't update it.

Monthly Payment:

• Develop a budget for your new home BEFORE you buy including the:
  • Monthly mortgage principle and interest payment
  • Monthly property taxes
  • Monthly homeowner's insurance
  • Monthly mortgage insurance
  • Monthly utilities including water and sewer, garbage, electricity, gas, phone, cable
  Water and sewer, garbage, electricity, gas, phone, cable
  
  If you buy a townhome or condo, some of these fees are included in the monthly association dues so then you would replace these in your budget.
  
  When you shop, then be sure to pay attention to ALL the costs of every home including the sales price, the taxes and if a townhome or condo, the association dues. Controlling all three of these can help control your monthly payment too.
• Watch interest rates carefully and make every effort to qualify for the best interest rates by keeping a good credit record. Lenders offer several types of loans. The best loans are called "A" loans and offer the best rates. A difference of only 1% in mortgage interest can cost as much as $70 a month on a loan of $100,000.
• It's hard to keep the loan payment down if you spend too much for the home so stick to your home purchase price budget AND GOOD LUCK.