Quick Tips on Buying...
- Stick to budget
- Shop around for a good mortgage rate with a solid lender
- Account for future variations in income
- Pay-off as much debt as possible
- Get your Credit report and correct errors
- Pre-Qualification can be a great tool for negotiation with
- Get references when selecting a RE agent/broker
- Seek services from a well-informed RE Agent/Broker
- Get a Buyer's agent if you are not comfortable with the idea
of working with a Seller's agent
- Get a reputable Home Inspector
- Select a house that is consistent with the houses in that
- Take pictures of the house that you are considering to make
an offer on
- Get prices of similar houses in the neighborhood from the
town or city hall
- You can make an offer contingent upon certain conditions (like
fixing something etc)
- If you have pre-qualified then let the seller know
More Tips on Buying...
1. ALWAYS HAVE AN ADVOCATE!
The law in most states has been updated to allow for
buyer representation in the real estate transaction. Previously, the agent worked
only for the seller. As a buyer, you were on your own. In this age of consumer
advocacy, you now have the right to your own representation to help protect your
best interests. Insist on a "Buyer Broker" or a "Buyer Agent" relationship with
2. INVEST A FEW HOURS FOR FUTURE DIVIDENDS
Here's your chance to keep the stress level down in
the transaction. Preparation for a purchase can save hours of worry later. Sit
with the lender, banker, or mortgage broker of your choice before you start looking
at properties. Ask to have a full pre-approval for a mortgage loan so you can
shop "stress free" for the home of your dreams. If you are an investor, have multiple
properties, or are trying some "creative financing", it is particularly important
to get the loan approval up front. Caution: some lenders will issue a "Pre-Qualification"
statement to a purchaser; this is NOT what you want. Insist on full pre-approval
conditional only upon the receipt of a ratified contract and an acceptable appraisal
on the property!
3. INSIST ON A HOME INSPECTION
Unless you are purchasing the home "as is" with the
understanding that what you see is what you get, always insist on a professional
home inspection. For a small investment of time and money, you can learn about
the new property and be alerted to any potential problems with the structure or
systems in the property. This request for an inspection can be made a part of
the contract or the contract can be contingent upon your approval of the results
of the inspection.
4. DON'T SHUT OFF A CONTRACT NEGOTIATION
One of the most difficult times of the entire purchase
process is during the contract negotiation. The key is to try and remain calm,
unemotional and keep focused on the logic. You need to evaluate each step carefully,
with the question, "How does this option affect me?", always at the top of mind.
Frequently, contracts are sent back and forth between buyer and seller several
times before all the issues are addressed and solved in a manner that is mutually
agreeable to all parties. Be patient, and let your professional buyer agent keep
things moving forward toward a successful purchase.
5. THINK RESALE
Unless you are planning on occupying your home forever,
it is very important that you ask your agent if there might be a problem with
reselling the property you have selected at a later date. While I don't have a
crystal ball, I do have lots of experience in the marketplace and can advise you
on what sells in the local market.
6. ASK FOR THE NUMBERS UP FRONT
Before you sign the contract, ask to see the estimate
of closing costs for that particular property, and the calculation of your approximate
total monthly payment (sometimes referred to as PITI). Make sure that you have
the cash required to close and that you qualify for the monthly payment before
you make the offer. Once you have a baseline established, it's very easy to adjust
the calculation if a counter-offer is made by the seller.
7. LIGHTEN UP
Turn on the excitement and enjoy the experience of
purchasing a new property. It is a special time in your life, and you should feel
special about the process!
8. AVOID CROWD SCENES
When you are buying a home, keep the company present
to a minimum. You may be excited about making a purchase, but too many opinions
often cloud issues. The parties financially responsible for making the payments
and coming up with the closing costs should be the ones making the selection.
You can invite all your other friends, acquaintances, etc. to a housewarming party
to show off your new property after you close the transaction.
Be friendly, but don't try to force conversation when
you are inside someone else's home. View the properties with a minimum of distraction.
10. KEEP A LOW PROFILE
Nobody knows your needs as well as you do. Your agent
will have an easier time articulating the virtues of your contract offer if you
stay in the background.
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