With interest rates rising and the housing market slowing, 2023 is set to be a good year for homebuyers. Although there are still a few months left before the start of the new year, now is the time to prepare for the purchase of a home if you are soon on the market.
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Here are 5 moves to make right now.
Focus on savings
Hopefully you now have enough nest egg and can afford to put down a down payment without disrupting your emergency savings. Either way, you can never have too much cash interest in your savings account. You will need to cover not only a down payment, but also closing costs and move-in costs. Keep this in mind when saving money.
Get your credit report
When was the last time you downloaded a copy of your credit reports from all three credit bureaus? Get free copies of your credit reports from Experian, Equifax and TransUnion. Read them carefully so that you can immediately dispute any errors or fraudulent activity.
Increase your credit score
The better your credit score, the better your chances of getting a good mortgage rate and attracting sellers. If you haven’t already paid your bills on time, you need to start being fussy about it. Additionally, you’ll want to keep your current credit cards open — and not open any new accounts or take out any other loans.
Double the debt
Now is the time to make more than the minimum payments due on your debts. The more debt you have, the more reluctant a lender may be to approve you for a loan.
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Get pre-approved for a loan
One of the first questions a realtor will ask you once they know you’re a serious potential buyer is whether you’re pre-approved for a loan. Your answer should be “yes”. Start your journey to getting pre-approved by consulting with lenders who will review your income, assets, and credit score to inform you of the loan options that are best for you.
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This article originally appeared on GOBankingRates.com: Hopeful Landlord? 5 Ways to Prepare Now for Potential Price Drops in 2023