Homeownership has long been a reliable and valuable investment for many Americans.
In Delaware, the real estate market has been experiencing steady growth, with home prices rising — up 5.7% compared to last year, according to Redfin’s October 2024 Delaware Housing report — and an increase in housing inventory.
However, a lack of understanding about the homebuying process and coming up with the upfront cash needed for a down payment and closing costs are among the barriers many Americans still face on their journey to homeownership. That’s why it’s important to consider your options and seek out resources to help navigate the homebuying process.
Here, Darcie Gore, executive director and senior lending manager at Chase Home Lending, shares five important things to consider before purchasing a home in Delaware:
- Come prepared and don’t stress about rates.
The best time to buy a home is when you’re financially ready. Worry less about the current economic environment and more about your own preparedness for homeownership, including fully knowing and understanding your financial situation, debt level, credit score, savings and investment positions.
- Understand your down payment options.
A down payment is what you pay upfront toward the cost of your new home; it’s the difference between your mortgage amount and your purchase price. The more you can put down, the less you’ll be borrowing from a lender. It is a myth that you must put down 20% of the purchase price. Low down payment loan options are available — in some cases, as low as 3%. Keep in mind that if you put less than 20% down, you may be required to pay private mortgage insurance. Make sure to speak to a Home Lending Advisor to understand the options that may work for you.
- Evaluate loan types and shop around.
There are many different types of home loans available, and having an experienced mortgage professional on your side can help you make the right decision for you. Here are the most common types of loans:
- A conventional loan typically calls for a higher credit score to qualify and can be accessed through private lenders, including banks, credit unions, and mortgage companies.
- An FHA loan is backed by the federal government. These loans can help potential buyers with lower credit scores who wish to keep their down payment costs low. Buyers using an FHA loan are required to pay monthly mortgage insurance premiums, regardless of the down payment amount.
- A VA loan is a mortgage the U.S. Department of Veterans Affairs offers to servicemembers, veterans and surviving spouses. VA loans can have favorable terms, including no down payment. Active-duty service members and veterans who choose Chase for their VA Loan will receive a $2,000 Chase VA Purchase Closing Cost Benefit.
- Your financial institution may also offer additional loan options. An example is Chase’s DreaMaker mortgage, which has flexible credit guidelines and requires as little as 3% down.
- Use tools to help.
It’s important to look into the financial resources available to help you purchase a home. Chase offers a homebuyer grant of up to $5,000 to buyers purchasing homes in eligible areas, including eligible areas in Delaware. These grants are offered in low- to moderate-income communities and neighborhoods that are designated by the U.S. Census as majority-Black, Hispanic and/or Latino. The grant can be used to lower the interest rate and/or reduce closing costs or down payment and can be stacked with additional homebuyer assistance programs. You can check grant eligibility online with the Chase Homebuyer Assistance Finder and also discover other financial assistance that may be available.
For added confidence during the closing process, Chase also offers a Closing Guarantee, which promises an on-time closing for eligible customers in as soon as three weeks, or the customer will receive $5,000 if they qualify.
- Get educated.
Buying a home can be the achievement of a lifetime, but being able to sustain homeownership over time is equally, if not even more, important. For the best chances of success, homebuyers should not only get educated about the buying process, but also understand the ins and outs of homeownership after the home is purchased. Chase’s Beginner to Buyer podcast and its Homebuyer Education Center offers tips and first-hand experiences on homebuying, selling, and ownership.
Homeownership offers many benefits beyond just a place to live—it’s a time-tested way to start building personal and generational wealth. That’s why it’s never too early to start working toward your dreams of homeownership. After all, it’s an investment in your future.
+++
For informational/educational purposes only: Views and strategies described in this article or provided via links may not be appropriate for everyone and are not intended as specific advice/recommendation for any business. Information has been obtained from sources believed to be reliable, but JPMorgan Chase & Co. or its affiliates and/or subsidiaries do not warrant its completeness or accuracy. The material is not intended to provide legal, tax, or financial advice or to indicate the availability or suitability of any JPMorgan Chase Bank, N.A. product or service. You should carefully consider your needs and objectives before making any decisions and consult the appropriate professional(s). Outlooks and past performance are not guarantees of future results. JPMorgan Chase & Co. and its affiliates are not responsible for, and do not provide or endorse third party products, services, or other content.
Deposit products provided by JPMorgan Chase Bank, N.A. Member FDIC. Equal Opportunity Lender.
The post 5 things to consider before buying a home in Delaware appeared first on Spotlight Delaware.