However, with the help of a trusted real estate professional like myself, we can navigate the rough waters together and get to the closing table! Here are the TEN most important things that I like to share with buyers during my initial client consultations.
TEN THINGS TO KNOW ABOUT YOUR HOME SEARCH
- There is no such thing as a “perfect” house. Homes are just like people – they all have problems. Even if you decide to build a brand new custom home, there will always be things you wish were different. While looking for a home, you must decide which “needs” and “wants” are most important to you and which things you can live without or compromise on.
- Do not begin your search without a pre-approval letter from a mortgage professional. It only takes a short time (48 hours maximum) to receive the letter and by knowing what amount you qualify to purchase, you will be able to set a maximum amount in your search. This will ensure that you are not looking at options outside of your price range. If you are looking at homes in a much higher price range and then find out you can only qualify for half of that amount, it will make your search difficult and disappointing. I promise you that the homes in your realistic price range will never compare to your dream price range. Also, sellers will not review or accept a contract without a pre-approval letter, so it is best to have it ready and prepared as a first step in your home search.
- You may be approved for a total purchase amount higher than you desire to spend. No matter what you find in the market, do not buy a home that is outside of your comfortable budget zone. Buying a home is a huge financial commitment, and you cannot feasibly agree to “not eat out at restaurants” for the next 30 years, so please do not over-extend yourself.
- As difficult as it can be, you cannot fall in love with a home until you receive the keys at closing. The saying “it ain’t over until it’s over” is true with buying a home, and it’s not “over” until the closing day. This is a difficult one because you have to “love” a home enough to make an offer, but you also have to remain calm because many things can happen between a contract signing and closing. For example, during your home inspection problems could turn up that need to be addressed. If the seller isn’t willing to fix the problems or reduce the price, you will have to decide if you are going to walk away from the home or accept the home as-is. It is easier to overcome obstacles like this along the way if you stay as neutral and unattached as possible.
- Always consider the option to build a new home, but never without bringing a real estate agent with you to the builder sites. The sales associate employed by the builder only represents the builder and will not look out for your best interests. Also, it is unfair but most builders will not allow a real estate agent to represent you later on if you have not brought them into the initial meetings.
- If you are not paying cash for a property, you will need to obtain a mortgage. In order to obtain a mortgage, an appraisal will need to be completed. The appraised value must be at or above the sale price noted on the contract. If the home appraises for less than the negotiated sale price, the seller will have to reduce the sale price or the buyer will need to pay cash above the appraised value.
- The home inspections and the appraisal will need to be paid for “outside of closing,” sometime during the 30-45 days before closing. You will pay the home inspection company directly upon scheduling and give the lender a credit card authorization form for the appraisal when it is ordered. All other closing costs are lumped together and paid for by the buyer at closing.
- After signing the sales contract, you will need to provide a check to the title company for the Good Faith Deposit for an amount that will be outlined in the contract. This amount is typically 1-2% of the sale price and will be held in an account by the title company until closing. They will cash the check when they receive it. At closing this deposit, which you have already “paid,” will be applied towards the purchase of the home.
- Most of the online real estate sites (Zillow, Trulia, etc) are terribly inaccurate. Just remember that these sites are run and managed by a computer, not a human being with a true pulse on the market. Your real estate agent is your link to accurate, true, up-to-the-minute market information in your area. If and when you find any homes that interest you on any of these sites, I will be happy to double-check to see if it is still available and if the information is accurate.
- HGTV is not real. Don’t get me wrong, I am sure they are real buyers really buying homes. However, please remember that hundreds of hours of footage is edited down to a cute, 30-minute show portraying only the most exciting moments of buying a home. While they are fun to watch, these shows do not give buyers today a realistic idea of how tough it can be to purchase a home.
Tara Moore, REALTOR