How to Buy a House in Wisconsin: A Homebuyer’s Guide
Updated: November 13, 2023
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Wisconsin's median home price of $268K is up 11% from the previous year and is increasing at a slower pace than the national average, which is around $365K.
Budget is crucial, but you'll need to consider other factors, such as the lender's terms when buying a house. Finding a home, completing the application and avoiding incurring significant debt can be easier when you have researched and know what to expect. MoneyGeek outlines the purchase process for the average homebuyer, including details such as how much it costs to buy a house in Wisconsin.
Choose an Ideal Location
Buyers consistently rank location as one of the most important considerations in the home purchasing process. The home's price and your monthly mortgage payments will fluctuate widely depending on where you decide to buy. Taking stock of your priorities and current lifestyle is important. Culture, cost of living and proximity to essential services and entertainment options are some indicators that point to a neighborhood's quality.
Calculate Mortgage Rates
Before you start house hunting in Wisconsin, check the state's mortgage rates. Wisconsin buyers can choose from a variety of mortgage plans, and the ideal one for you will depend on your individual needs.
Factors like your income, credit history and score, and debt-to-income ratio can be crucial in determining the loan amount and the interest rate lenders will offer you. You may need to compare various lenders to determine which offers the best rate for your circumstances.
Prepare Down Payment Requirements
It is conventional to make a down payment when buying a house. Your down payment amount affects your annual percentage rate (APR). Typically, the higher the down payment, the lower the rate.
Get Pre-Approved for a Mortgage
After you've decided on a lender, you must be pre-approved for a mortgage. Don’t confuse pre-approval with pre-qualification. Pre-qualification does not require a credit check, whereas a pre-approval requires a hard credit check on your financial profile, which can lower your credit score. Pre-approval is a commitment from the lender to let you borrow a certain amount.
Conduct a Home Inspection
Before buying a house, you should arrange for a home inspection. A certified home inspector will offer insight into the property's condition and identify any necessary repairs. Typically, the house inspection fee is the buyer’s responsibility. If the house requires repairs or renovations, the home inspection results can give the buyer negotiating leverage.
Close Your Mortgage Loan
You'll incur closing costs when buying a home. Credit report retrieval, lender appraisal and document preparation fees all fall under the umbrella of closing costs. Third-party services, such as a home inspection, legal advice, pest inspection and so on, may also factor into the closing costs.
Wisconsin Homebuying Details
Wise Wisconsin homebuyers should do their homework on different home locations and shop for the best interest rates. Your lender or real estate agent will inform you of additional Wisconsin-specific requirements.
Wisconsin residents can also research and determine whether they qualify for homebuyer assistance programs.
Milwaukee County Mortgage Assistance Program
Homeowners in Milwaukee County who have fallen behind on their mortgage payments due to employment or wage concerns because of the COVID-19 pandemic may be eligible for emergency assistance through the Milwaukee County Mortgage Assistance Program.
Frequently Asked Questions About Buying a Home in Wisconsin
MoneyGeek responds to questions about buying a home in Wisconsin.
If you're thinking of buying a house in Wisconsin, consider the following questions:
- Which area best fits your needs and budget?
- For what kinds of mortgages and at what interest rates do you qualify?
Wisconsin real estate can be an excellent investment if you are willing to commit financially and are pleased with the location, costs and associated procedures.
The average home in Wisconsin has increased in value by 11% over the past year, reaching $268K. If you're financially prepared, purchasing a home in this state may be a wise option.
The income required to buy a house in Wisconsin depends on the type of mortgage you choose. To avoid private mortgage insurance (PMI), conventional loan lenders require a minimum down payment of 20%.
Real estate taxes in Wisconsin average around $3,007 per year, and the state average tax rate is 1.76%.
Milwaukee is the cheapest city in Wisconsin to buy a home. However, the city has a higher cost of living, which could significantly increase your living expenses.
sources
- Housing Resources Inc. "Milwaukee County Mortgage Assistance Program." Accessed October 22, 2022.
- LivingCost.org. "Cost of Living in Wisconsin State." Accessed October 22, 2022.
- Missouri Economic Research and Information Center. "Cost of Living Data Series." Accessed October 22, 2022.
- Tax.rates.org. "Wisconsin Property Taxes 2023." Accessed April 26, 2023.
- U.S. Department of Housing and Urban Development. "Homeownership Assistance: Wisconsin." Accessed October 22, 2022.
- WHEDA. "WHEDA First Mortgage and Down Payment Assistance Programs." Accessed October 22, 2022.
- Zillow. "Wisconsin Home Values." Accessed October 22, 2022.
- Zillow. "United States Home Values." Accessed October 22, 2022.