Most people think spring is the best time to buy or sell a home. This idea comes from practical reasons and some misconceptions about the market. In spring, people are often eager to get outside after a long winter, which fits well with moving plans that align with the school calendar.
Interestingly, a Chase survey found that many Americans plan to buy homes this summer. But are they good at understanding mortgage numbers?
Interest rates recently hit 4% for the first time since November 2014, and there’s speculation they might keep rising. So, it could be a great time to invest if you’re looking to save. The math is clear: a 30-year mortgage at 4% interest can save you nearly $60,000 compared to one at 5%.
While interest rates are important, many homebuyers overlook other costs. These include paying for a home inspection to avoid buying a faulty property and covering the costs of a property survey required by lenders. You also need to budget for upfront tax payments at closing.
There are several fees to consider at closing as well, like government recording charges, appraisal fees, credit report fees, title services and lender’s title insurance, flood life-of-the-loan fees, tax service fees, and a lender’s origination fee.
Other expenses to keep in mind are homeowners’ association dues, insurance costs, and the potential costs of home improvements and new furnishings.
Moving can be expensive too, especially if you’re moving cross-country. Even local moves can add up with costs for truck rentals, moving services, and equipment. Don’t forget the costs of setting up utilities like phone, electricity, gas, and water, which can be substantial if you’re moving to a larger home or from a rental property. You might also need new furniture or appliances for your new house, making it feel like home can be financially challenging.
It’s crucial to budget for ongoing maintenance and potential renovations, such as painting, roof repairs, plumbing, and wiring fixes. A good rule of thumb is to save 1% of your home’s purchase price each year for these costs, though this can vary based on the home’s age, the previous owner’s maintenance habits, and the local climate.
Chase offers many resources for potential homebuyers, including mortgage calculators and more information on their website. You can also find helpful videos on the Chase YouTube channel.