With mortgage rates climbing, buying a home might seem challenging, but it’s still achievable with the right strategy. As a Senior Loan Officer at Jhenesis Mortgage, I’ve guided many buyers through tough markets. Here are five practical steps to help you purchase a home while keeping costs down, packed with top search keywords like buy a home, mortgage rates, fixer-uppers, and homeownership.
1. Consider Fixer-Uppers for Lower Costs
Fixer-uppers—homes needing repairs or updates—often have lower price tags, making them a great option for first-time homebuyers. If the home has a solid structure but outdated features like an old kitchen or bathroom, it could be a smart investment. Renovating over time can boost the home’s value while saving you money upfront.
Pro Tip: Focus on homes in good condition that need only cosmetic updates. A fresh coat of paint or new flooring can make a big difference without a huge budget.
2. Boost Your Down Payment to Reduce Borrowing
A larger down payment means borrowing less, which leads to lower monthly payments and better loan options. Cut small expenses and save consistently—small changes can add up fast.
Example: Saving $5 a day adds up to $1,800 in a year, which can go directly toward your down payment.
Pro Tip: Explore down payment assistance programs to supplement your savings.
3. Explore Adjustable Rate Mortgages (ARMs)
An adjustable rate mortgage (ARM) offers a lower interest rate for the first few years, ideal if you plan to move or refinance before the rate adjusts. Be sure to understand potential rate increases and future payment scenarios.
Key Consideration: Work with a trusted lender like Jhenesis Mortgage to see if an ARM fits your financial plan.
4. Use Mortgage Points to Lower Your Rate
Paying upfront for mortgage points can “buy down” your interest rate, reducing monthly payments over time. While it requires more cash at closing, it can save money long-term.
Advice: Discuss with your lender to see if buying points aligns with your budget and homeownership goals.
5. Consider Co-Buying with a Trusted Partner
Co-buying with a friend or family member can increase your purchasing power. Combining incomes may qualify you for a tmp. Ensure you have a clear, written agreement about responsibilities and future plans.
Pro Tip: Consult a legal professional to draft a co-buying agreement for clarity and protection.
Final Thoughts on Buying a Home in 2025
Despite higher interest rates, homeownership is still within reach. By exploring fixer-uppers, saving for a larger down payment, considering ARMs, using mortgage points, or co-buying, you can achieve your dream of owning a home. Act now—before home prices or rates rise further.
Frequently Asked Questions (FAQ)
What is a fixer-upper, and is it a good investment?
A fixer-upper is a home needing repairs or updates, often sold at a lower price. It’s a great investment if the home is structurally sound and you’re prepared to renovate over time.
How much should I save for a down payment?
Aim for 5-20% of the home’s price, depending on your loan type. A larger down payment lowers your loan amount and monthly payments.
Are adjustable rate mortgages (ARMs) risky?
ARMs can be a good choice if you plan to move or refinance before the rate adjusts. Understand potential rate increases and future payments.
What are mortgage points, and are they worth it?
Mortgage points are fees paid upfront to lower your interest rate. They can save money long-term but depend on your financial situation.
Can I buy a home with a friend or family member?
Yes, co-buying allows you to combine incomes and share costs. A legal agreement is essential to outline responsibilities.
Ready to start your homeownership journey? Contact Stacy Ann Stephens, Senior Loan Officer at 407-630-9766 or Jhenesis Mortgage, to explore your mortgage options. Schedule a quick call today and take the first step toward owning your dream home!