Whenever you think about mortgages, you probably imagine that you need a seriously exceptional credit…
The coronavirus pandemic has turned many industries on their head remarkably quickly. The real estate sector has been hit as badly as any, but if you’ve been planning on buying a home, it’s not necessarily time to put your ideas on hold.
In fact, the situation might offer some excellent home-buying opportunities. Harsh as it may sound, there are likely to be many sellers in reduced circumstances who are ready to accept a lower offer. There’s also likely to be less competition as potential buyers decide to sit the crisis out.
But despite these reasons, buying a home during COVID-19 isn’t quite as straightforward as in more normal times. Here’s how to approach it safely and effectively.
1) Budget Carefully
COVID-19 means uncertain times for everyone. Even if you’re financially secure, it’s best to take a pause and decide if making such an important commitment is a prudent idea right now.
Even if you’re confident you’re in good financial shape, it may be wise to leave yourself a bit of budget breathing space by setting your sights a little lower than you might otherwise do. Now more than ever, aim to keep at least six months’ living expenses in a reserve emergency fund to help protect you if something unexpected happens after you buy.
2) Get a Mortgage Pre-Approval
Before starting to look for a home, it’s advisable to get a mortgage pre-approval in place. This will help in two ways.
First, the mortgage outlook is extremely volatile as the industry prepares for a probable rise in delinquencies. Getting a pre-approval will let you know exactly what kind of deal you can get under the current circumstances, and will lock in the offer even if lenders begin to tighten their approval criteria.
Second, social distancing rules mean everything from appraisals to closing is likely to be delayed. Starting early with your mortgage application will remove at least one holdup from the chain.
And don’t forget to shop around when looking for a pre-approval. Some lenders are looking to actively increase their business at the moment, and there are some enticing low-interest deals on offer.
3) Research Thoroughly Online
While social distancing is still in operation, the old approach of viewing many potential homes in a single day is out of the question. Narrow down your choices by researching as much as you can online rather than relying on a personal visit to inform your decisions.
And when you’ve found a home that catches your eye, ask for a video tour as your first expression of interest. Follow this up with video meetings where you can get answers to any questions you have. Only when you’re satisfied that the home has real potential should you arrange a physical viewing.
If the seller or their agent isn’t happy to meet your digital requests, then move on to the next home on your list. And if your own buying agent doesn’t take your approach seriously, then find one who does.
4) Viewings Under Social Distancing
When it comes to finally viewing a potential home, ask the seller what precautions they’re taking, such as disinfecting touch surfaces before and after every viewing. Ask if anyone connected with the property has been exposed to COVID-19, or worse, has actually been infected.
If you don’t feel satisfied over safety, then make your worries clear and insist you’ll go no further without an adequate response.
And when you do visit, take all the normal precautions such as wearing masks, gloves, and shoe coverings, and using hand sanitizer before and after. Ideally the owner should vacate the property so you can look around without the worry of mixing with strangers, but at the least they should know you expect careful social distancing measures to be followed.
There’s no reason to put off buying a home until the crisis finally clears, but it’s only sensible to do it as safely as possible without rushing into any unnecessary risks. Prepare well and take it slowly, and you might find that now is a great time for clinching a home-buying bargain.