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After spending three years in Germany, Danielle & Jimmy returned to their home country and spent the next six month looking for their first home.
“Location was so important to us. We got used to walking everywhere while we were in Germany. Grocery stores, restaurants, beer gardens and pubs were all within walking distance of our apartment. We wanted to find a neighborhood like that,”Danielle, a lawyer in employee relations, explains.
They found the perfect area: Bay View in Wisconsin. They also found the perfect house, located right across from a beautiful park and with stunning views of Lake Michigan.
However, the house needed $20,000 of renovations. The sale price was also high.
“We looked at other homes in the neighborhood that were cheaper and in better shape. But we kept coming back to this one. It was in the perfect spot. And when we found out there is a beer garden in the park in summer, it was a done deal!” Danielle says.
The house was sold in January. They spent one month painting, installing new flooring in the kitchen and remodeling the master bathroom before moving in.
So how did Danielle & Jimmy buy a much more expensive house and still have enough money for repairs? Here’s how they did this, with the help of their loan officer
1. They had to be pre-approved before they could start the house hunting process.
2. They combined conventional financing with private mortgage insurance. This allowed them to pay 5 percent instead of the usual 20 percent. Although their mortgage payment is more expensive, it still fits within their monthly budget.
3. It was possible to purchase a more expensive home with a lower down payment.
4. The couple was able to pay less down and still have enough cash to finish the renovations.
You can find more information here about buying a home with conventional financing, a low downpayment, and other helpful tips. This site was created specifically for first-time buyers. readynest.com.
