It’s one thing to buy a house when you can drive around the neighborhood, scope out its proximity to parks and schools, or hop on public transportation to time your commute. But it’s an entirely different thing to buy a house in another state, particularly if you’re unable to visit first. According to the U.S. Census Bureau, while the overall move rate for the U.S. population has declined in recent years, the rate of people moving between states has held steady at one-fifth of all moves. People cite the reason for their moves as housing-related, family-related, and job-related. Jenah Mahan is an experienced agent in Tacoma, WA, an area that serves the military community. She often works with out-of-state buyers, and says one of the biggest pitfalls to avoid is miscommunication — it comes down to meeting her buyer’s expectations. “My version of clean might be different than somebody else’s, and my version of a large bedroom is different,” she says. “That can be the biggest pitfall, putting your total trust into somebody else.” When she works with out-of-state buyers, she says it’s incredibly important to communicate and get into their head. If you’re moving states, it can be overwhelming and hard to know where to start! Do you find movers first, or talk to a real estate agent? This step-by-step guide will help you through buying a home out of state. There’s always a cost to moving and buying a new house, but that cost can vary widely between states. Average home prices could be more or less than where you’re currently living, which will impact the size of your required down payment. Conventional and FHA loan limits also vary by state and county, so you might be able to afford more home than you think. If you know the move is coming, do some preliminary research on the housing market in your new state. Try to get a feel for the housing prices in potential neighborhoods — a local agent is a great source — and how much you will need for your down payment. As soon as you possibly can, start saving money. Also, consider cutting back on any unnecessary expenses. If you’ll be driving across state lines and are a two-car family, consider selling one car to save on gas and insurance before the move. For more tips on saving for a down payment, check out these tips. If you don’t think you can put 20% down on a new house, look into down payment assistance programs at the state and county level. Many states have programs that help first-time homebuyers, veterans, and more. A local mortgage broker could point you in the right direction. Don’t forget that you’ll need to cover closing costs, too. Closing costs are typically between 2% to 5% of the total purchase price. Once you have an idea of average home prices in your new state, you can use our closing costs calculator to estimate how much you’ll need to save on top of your down payment. When you’re planning your cross-state budget, leave room for moving costs! Long-distance moves can cost more than a quick, half-day move across town. We will break that down later. Lenders need to be licensed in the state you are looking to purchase in, so chances are your local lender won’t be able to help you here. Do your research to find a local reputable lender, or work with a mortgage broker who can network with several local lenders to find you the best deal. If you are relocating for a job, your lender will need to see your offer letter and your projected start date to determine your ability to repay the loan. When preapproving a loan, lenders also look at: If the move is several months to a year away, use that time to improve your credit score. Pay down any revolving debt, like credit cards, and make sure you make all payments on time. For more credit improvement tips, see this guide.1. Save for your down payment and closing costs
2. Get preapproved for your mortgage
