If you’ve been waiting to buy a home because ownership feels out of reach, you’re not alone. Headlines about high home prices and mortgage rates have convinced plenty of would-be buyers to put their plans on hold.
But news headlines describe the market in general. Your own purchase depends on specific factors like, the home, the financing, and the monthly payment. Those specifics can look quite different from the national picture, which is why it may be worth another look at what is possible for you.
Move-in ready homes are waiting for buyers
When a builder has an inventory of completed or nearly completed homes ready for owners, that creates room to negotiate and to move quickly. It also means no long construction timeline between signing and getting the keys.
A new construction home can also add up to savings over time compared with an older one, thanks to warranties, energy-efficient features that can lower utility bills and fewer repairs in the early years of ownership.
Builder incentives can change the math in your favor
The sticker price is only one piece of what a home costs. Builder incentives can include mortgage rate buydowns, closing cost assistance and upgrades. Each type works on a different part of your budget.
What is a mortgage rate buydown?
A buydown lowers your interest rate, either for the first few years of the loan (temporary) or for its full term (permanent). Builders often fund them as an incentive, which can reduce your monthly payment.
Even a small change in rate can make a real difference. On a $380,000 loan, each full percentage point lower can reduce the monthly payment by roughly $245. A 2-1 buydown starts with an interest rate 2 percentage points below your full rate in the first year and 1 point below in the second, then the full rate applies from year three onward. That means the savings can be significant in the early years when you are just settling into a new home and budgeting for everything that comes with it.
(These numbers are illustrative. Your own payment will depend on your loan, your lender and the offer.)
Closing cost assistance can shrink the amount of cash you need up front. As part of an incentive package, design upgrades can add value to the home at no extra cost to you.
Financing options can lower the cash you need at closing
Whether you’ve saved for a down payment or are still working toward one, the loan you choose can affect how much cash you’ll need up front. Some programs, like the Mutual Assist Down Payment Assistance loan through Mutual of Omaha Mortgage, may be able to help. This is an FHA loan that pairs a first mortgage with a second mortgage to cover the down payment.
Highlights include:
The program also offers an option to finance up to 101.5% of the purchase price, with the extra 1.5% going toward closing costs.
Programs, terms and rates are subject to change, and loans are subject to credit approval. Contact a Mutual of Omaha loan officer to determine whether this program may benefit you.
Compare the monthly payment as well as the price
When you weigh your options, be sure to look at the full picture. A few questions can help you compare offers side by side:
A lender can run the numbers for you in minutes, and the answers can look quite different from what you would expect. Start the conversation with a loan officer.
Why buy a home now, is worth another look
Plenty of people decide they can’t afford a home before they have seen what their actual payment would be. Incentives shift with market conditions, so what is available today may look different down the road. A conversation costs you nothing and can give you a clearer picture of your options.
Wondering if a new home in Central or Northeastern Oregon is possible for you? Explore available MonteVista Homes and contact our sales team at 541-516-1999 to ask about current incentives.
Offers and programs vary by community and are subject to change. Connect with the MonteVista Homes sales team for current details.
