When many people from our community come to the United States, they do so with the so-called “American dream” in mind, which motivates them to do their best to buy a home. We live in a time where finding affordable housing seems more like an illusion than a reality. Property prices rose again and reached a new all-time high. Don't let this discourage you, we also bring you some tips so you can become an owner.

According to a report published by Redfin on July 13, the median home price reached $408,776 during June, a new all-time high. The figure represents an increase of 2.2% compared to the same month last year and is 51.4% higher than the highest level recorded in 2019, before the changes caused by the pandemic in the real estate market.

The report also notes that home sales grew during June, even though mortgage rates have remained around 6.5% for several months. Some of that demand comes from more affluent buyers in markets like California's Bay Area and South Florida, where competition continues to drive prices.

If you are thinking about buying a house, this does not mean that you should give up on that goal. There are decisions that can help you pay less for your financing and that, over the years, can represent savings of thousands of dollars.

1. Compare various financing options

One of the most important steps is not to accept the first mortgage offer you receive. Even if two financial institutions seem to offer similar terms, a small difference in the interest rate can significantly change the amount you end up paying.

A good practice is to request quotes from several lenders and compare not only the interest rate, but also the fees, closing costs and terms of the loan. Even credit unions can be an attractive alternative, as they often offer competitive terms for their members.

Spending a few days doing this comparative work can represent considerable savings over the entire life of the mortgage.

2. Check if you qualify for a government-backed program

Many people are unaware that there are loans designed to facilitate the purchase of a home. These include programs supported by the Federal Housing Administration (FHA), the Department of Veterans Affairs (VA), and the United States Department of Agriculture (USDA).

Each one has specific requirements. For example, some allow for a smaller down payment than a conventional mortgage, while others are aimed at veterans or those looking to purchase a home in certain rural or suburban areas.

Before making a decision, it's worth investigating whether you qualify for any of these programs. In many cases they offer more favorable interest rates and make it easier to access the purchase of a home.

3. Improving your credit history can make a difference

Credit history is another of the factors that has the most weight when a bank calculates the interest rate on a mortgage. Think about it this way: if two people apply for the same loan, but one has been paying their debts on time for years and the other has frequent delays, it is very likely that the first will get better conditions.

Data from Experian shows that a person with a credit score of 780 or higher can access a 30-year fixed mortgage rate close to 6.51%. Instead, an applicant with a score of 620 could receive a rate of 7.41%. That difference can translate into thousands of additional dollars over the course of the loan.

With home prices at record highs, preparing your finances before applying for a mortgage can be just as important as choosing the right home. Make your dream come true, yes you can.

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