How to Buy a House in Mississippi: A Homebuyer’s Guide
Updated: May 21, 2023
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In Mississippi, the average price of a house is around $171K. It has increased year-over-year by 12.9%. Mississippi rates are more affordable than a typical home in the U.S., which averages almost $358K.
Moreover, Mississippi residents spend an average of $990 monthly for mortgages. It’s $169 less than the average monthly mortgage for the entire country. The cost and lender terms are some of the most crucial factors in homebuying.
Grasping the homebuying process will help you with your application. Then, you can seal the deal and avoid drowning in debt. In this guide, MoneyGeek outlines the essential information for Mississippi homebuyers.
Choose an Ideal Location
When you're searching for a house in Mississippi, you need to determine your desired location within the state. The price differs depending on the city and county, affecting an individual’s mortgage. For instance, based on 2022 data, the median home price in Canton is $194,777, compared to an average of $43,314 in Goodman.
The location shows the neighborhood culture, cost of living, recreational areas, amenities and even clubhouses. For this reason, it’s best to consider your lifestyle, needs and wants when evaluating the best place to buy a house in Mississippi.
Calculate Mortgage Rates
Your mortgage rates depend on many factors like the lender, credit score, credit history, income, interest rates, loan type, repayment terms, property size and more. Finding the balance among these factors is best for finding the most suitable mortgage rate.
Prepare Down Payment Requirements
Before you start homebuying, it’s best to provide a down payment. The rate depends on your loan type, as there are loans as low as 3.5%. However, most lenders require a down payment of at least 20%. Look at all of your options. You may qualify for a home loan that does not require a down payment, such as a VA or USDA home loan.
Get Pre-Approved for a Mortgage
When buying a home in Mississippi, getting pre-approved for a mortgage is necessary. Pre-approval lets you converse with the lender about the repayment terms and the budget you need. Some sellers will require a mortgage pre-approval before showing their property.
Remember that pre-approval doesn’t equate with pre-qualification. Pre-qualification means that your lender gives you a loan amount estimate. Consequently, pre-approval encompasses a credit check that’s not conducted in the pre-qualification process.
Conduct a Home Inspection
Before buying a home in Mississippi, it’s crucial to have a home inspection by a third-party professional. It’s crucial to uncover any significant problems or safety issues with the property (for a fee). It’s best to find out this information before purchasing a home. It's also an opportune time for the homebuyer to negotiate the price if the home requires repairs.
Close Your Mortgage Loan
After scrutinizing the loan terms and completing the home inspection and appraisal processes, you are ready to close the mortgage loan. Remember that when purchasing a home, there are closing costs. It refers to how much you’ll pay the lender for your credit report, appraisal fees and documentation costs.
For those with limited funds, there are Mississippi assistance programs that can help cover some of the closing costs.
Moreover, you’ll need to pay a third party for the home appraisal, legal work, pest inspection and control and more.
Mississippi Homebuying Details
Mississippi homebuyers must remember to research their preferred location and compare mortgage types and quotes to find the suitable and best lender.
These are essential steps to follow throughout your homebuying journey, but there may be specific processes in Mississippi. It’s best to contact your lender or a real estate agent so you’re prepared.
Moreover, some homeowner assistance programs in Mississippi will help you find a suitable property.
Smart6 Mortgage Program: Mississippi Home Corporation (MHC) offers this program, which helps borrowers get the funds they need to buy a home or move to the next one. Their partner lenders provide it at a 30-year fixed rate set by MHC.
Mortgage Revenue Bond 7: Mississippi Home Corporation (MHC) offers this program, which assists borrowers with home ownership by providing a competitive mortgage rate through the sales of Mortgage Revenue Bonds, which are federally tax-exempt. A down payment of $7,000 can help borrowers with their mortgage upfront costs.
Frequently Asked Questions About Buying a Home in Mississippi
Homebuying in Mississippi is a substantial undertaking and major success. MoneyGeek has answered some of the most commonly asked questions to help your homebuying journey.
It’s best to ask yourself if you are ready to buy your first home, where you want to live, your priorities and if you’re financially capable to sustain monthly mortgage payments.
Yes, if you are fully committed and entirely ready to do so.
Yes. Renting a place may cost you more in the long run than buying your first home. But buying a house is wiser if you’re financially equipped for it.
The average monthly expense for a household in Mississippi is $990. You may need more or less income depending on your preferred location. But you may use this figure as a baseline.
The average property tax in Mississippi is 0.52%.
According to Zillow’s listings, the cheapest city to buy a home in Mississippi is Goodman.
sources
- American Society of Home Inspectors. "Home Inspection Requirements for Mississippi." Accessed October 20, 2022.
- Department of Revenue State of Mississippi. "Property Taxes." Accessed October 20, 2022.
- FHA. "FHA Down Payment Assistance Grants for 2022 in Mississippi." Accessed October 20, 2022.
- FHA. "Mortgage Revenue Bond." Accessed October 20, 2022.
- FHA. "Smart Solution." Accessed October 20, 2022.
- Massachusetts Institute of Technology. "https://livingwage.mit.edu/counties/28051." Accessed October 20, 2022.
- Mississippi Department of Banking and Consumer Finance. "Mortgage - Mississippi Department of Banking and Consumer Finance." Accessed October 20, 2022.
- Mississippi Home Corporation. "Mortgage Revenue Bond 7." Accessed October 20, 2022.
- Mississippi Home Corporation. "Smart6." Accessed October 20, 2022.
- Tax-Rates.org. "Mississippi Property Taxes 2022." Accessed May 21, 2023.
- US News. "Complete Checklist of Documents Needed for a Mortgage." Accessed October 20, 2022.
- Zillow. "Mississippi Home Prices & Home Values." Accessed October 20, 2022.
- Zillow. "United States Home Prices & Home Values." Accessed October 20, 2022.