Whether you’re moving up the street or across the country, there are some things you should know about the moving process.
Moving can be costly. Besides the costs associated with physically moving, buying a new house and selling your old house is a big financial decision. If you’re considering buying a new home, there is a lot to think about, which is why we made this First-Time Homebuyer’s Checklist.
Home buying Costs: Down Payment and Closing Costs
Buying a home is a big investment. From a down payment to closing costs, you usually need some cash upfront when you’re ready to become a homeowner.
Closing costs include things like property taxes, homeowner’s insurance, title search fees, and appraisal fees. They also pay people who’ve performed services throughout your loan process, like your real estate agent and home appraiser. You may be asked to pay some of your closing costs as the action happens, for example, you may have to pay for the home inspection upon inspection. That amount will be subtracted from your total closing costs.
As the buyer, you may be able to negotiate with the seller in your offer as to who covers closing costs. Each loan type has different guidelines when it comes to seller contributions to closing costs.
Most likely, you’ll also have to make a down payment. Traditionally, conventional loans require a 20% down payment. So, for a house that’s $150,000, a 20% down payment would be $30,000. There are some loan options that offer low and no down payment options, like the FHA loan, for example, which only requires a 3.5% down payment. That would be $5,250 for a $150,000 house. Each loan type has different requirements and guidelines, so talk with your lender. Your mortgage banker will be able to talk you through your options and guide you toward what’s right for you.
If you’re moving close by, your move may be a little simpler. You can make multiple trips, and if you’re lucky, move a little bit at a time. However, if you’re moving cities or even states, you may have a little more work to do, most likely in one trip.
Consider the costs of renting a moving truck, gas, hiring movers (both in packing and unpacking the truck), and supplies. You may also need temporary lodging and storage for your things, depending on your moving timeline and when you’re required to be out of your old house or apartment. You should factor all of these potential costs into your budget.
Tips for a Stress-free Move
Moving can be stressful, but it doesn’t have to be. Once you have your finances in order, follow these helpful tips to make your move as seamless as possible.
- Start packing as soon as you have your moving date to avoid last minute chaos. If you pack a little bit at a time, you won’t be scrambling the week you’re supposed to move to pack your things. Pack non-essential things up first, like books and out-of-season clothes.
- Start packing in your infrequently used rooms and areas, like storage and closets. If you haven’t used something in a while but want to keep it, go ahead and pack it up. If you haven’t used it in the last few weeks, you probably won’t need it between now and the move either.
- Collect boxes and storage bins over time, so you don’t have to buy them all at once. Of course, you can buy boxes and Rubbermaid bins from the store but can also do a little thrifting. Save some of the bigger boxes your packages come in. You can also go to your local grocery and convenience stores for boxes—they’re sometimes willing to give you extras for free.
- Organize and purge your belongings. There is no need to move things you don’t need, like the sweater you haven’t worn in 5 years or the suitcase with the broken zipper. Make a trash pile and a donate pile and then stick to your rules. This will help you clean out your things and have less to move.
- Pack the items you use every day last. This includes things like bathroom and bedroom belongings, kitchen items, etc. You’ll need this almost until the last minute and you’ll want them unpacked first.
Following these tips can help to ensure a smooth and easy moving process. For more helpful homeownership tips and tricks, plus advice on mortgage loans and financing, visit the Atlantic Bay blog.