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10 Tips for Home Buying

 

The top 10 things you need to know before you buy

  1. Don’t buy if you’re a mover: If you can’t commit to remaining in one place for at least a few years, then owning is probably not for you at this time in your life. The costs of buying and selling a home, you may have you ending up losing money.
  2. What’s your credit: Most of us will need to get a mortgage to buy a house, make sure your credit score is strong. A few months before you start house hunting, get copies of your credit report. Make sure it’s correct, and fix any issues you discover. Your score can affect the type of loan and interest you will receive.
  3. Get Pre Approved so you know what you can really afford: Talk to a lender of your choice and see what loan types, are available for your credit score, to determine your purchasing power.
  4. The Down Money: There are a variety of public and private lenders who, if you qualify, offer low-interest mortgages that require a small down payment.
  5. Study the community and school district: Do your research to determine the community and school district where you are planning to purchase. This is important since your children will be attending the school, and your family will be interacting in the community. If you don’t have children it’s still an important factor since high demand school district tend to sell well when you resell the home in the future
  6. The Realtor: Even though the Internet gives buyers unprecedented access to home listings, most new buyers (and many more experienced ones) are better off using a professional agent. Just remember just because a Realtor is with a big firm does not mean they are experienced. Do your homework. A Realtor can share the nuances of the area and historical data that is not available on the web
  7. Choose carefully between points and rate: Ask your lender when picking a mortgage; you usually have the option of paying additional points — a portion of the interest that you pay at closing — in exchange for a lower interest rate. If you stay in the house for a long time — say three to five years or more — it’s usually a better deal to take the points. The lower interest rate will save you more in the long run. There is a difference between points and lender origination points.
  8. Before house hunting make a wish list: Create a list of what you are looking for in a home. Prioritize the list to what a necessary and what is a bonus. Most likely you will never find a home that matches your list perfectly, but you can determine easier if the home fits your needs when the emotions kick in.
  9. Do your homework before bidding: Your opening bid or offer should be based on the sales trend of similar home sales in the neighborhood. Your Realtor can supply a list of homes recently sold in your area that are comparables and help you determine a good starting offer point based on the condition of the home you wish to make an offer on.
  10. Hire a home inspector: After the offer is accepted a licensed home inspection should be strongly consider to evaluate the condition of your new home. The lender will not usually require home inspections so it it up to you to make this decision. Regardless of age or visual condition a home inspection is important. You should Interview several “local” home inspectors. The inspector should be licensed, experienced, and a member in good standing of NAHI,( National Association of Home Inspectors)and be a unbiased source. If you suspect a conflict of interest do not select that home inspector. His or her job will be to point out potential problems that could require costly repairs down the road. It is also an excellent time to get to know your new home better and understand how to maintain in after the closing.

Home buying is a big investment “Buy Wise”

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Tips on Reading an Inspection Report

When interviewing a home inspector, ask the inspector what type of report format he or she provides. There are many styles of reports used by property inspectors, including the checklist, computer generated using inspection programs, and the narrative style.

Some reports are delivered on site and some may take as long as 4 – 6 days for delivery. All reporting systems have pros and cons. The most important issue with an inspection report is the descriptions given for each item or component. A report that indicates the condition as “Good”, “Fair” or “Poor” without a detailed explanation is vague and can be easily misinterpreted. An example of a vague condition would be:

Kitchen Sink: Condition – Good, Fair, or Poor. None of these descriptions gives the homeowner an idea what is wrong. Does the sink have a cosmetic problem? Does the home have a plumbing problem? A good report should supply you with descriptive information on the condition of the site and home. An example of a descriptive condition is:

Kitchen sink: Condition – Minor wear, heavy wear, damaged, rust stains, or chips in enamel finish. Recommend sealing sink at counter top.

As you can see, this narrative description includes a recommendation for repair. Narrative reports without recommendations for repairing deficient items may be difficult to comprehend, should your knowledge of construction be limited.

Take the time and become familiar with your report. Should the report have a legend, key, symbols or icons, read and understand them thoroughly. The more information provided about the site and home, the easier to understand the overall condition.

At the end of the inspection your inspector may provide a summary with a question and answer period. Use this opportunity to ask questions regarding terms or conditions that you may not be familiar with. A good inspector should be able to explain the answers to your questions. If for some reason a question cannot be answered at the time of the inspection, the inspector should research the question and obtain the answer for you. For instance, if the inspector’s report states that the concrete foundation has common cracks, be sure to ask, “Why are they common?” The answer you should receive will be along these lines: common cracks are usually due to normal concrete curing and or shrinkage. The inspector’s knowledge and experience is how the size and characteristics of the cracking is determined.

We recommend that you accompany your inspector through the entire inspection if possible. This helps you to understand the condition of the home and the details of the report.

Read the report completely and understand the condition of the home you are about to purchase. After all, it is most likely one of the largest investments you will ever make.

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Avoid the pitfalls of Buying a FSBO

Did you know that you could actually lose money and create risk for yourself by buying directly from an owner?  Home buying is an emotional process and most buyers wear their emotions on their sleeves. They don’t ask the crucial questions which can open them up to potential risks factors, besides that typically are not good at negotiating the best deal for themselves.

Solution is to hire an experienced Buyer’s Broker to handle and negotiate the deal for you.  This typically cost 1- 3% of the purchase price, but sometimes you can negotiate a flat fee arrangement.  The Buyer’s Broker knows how to ask the serious questions about the property and can coordinate a 3rd party home inspector for you. Additionally they have access to the history of the home and the sales data for the area and know the nuisances of the area and the effect that it may have on value. Most buyers do not have access to the complete data, and even if they have some of it from the web they truly do not have the experience on how to interpret it and apply it to a successful negotiation strategy.
Buyers Brokers understand the physiology of the selling process and can be your front man to negotiate the best deal as your advocate.  After the sale is nailed down they can save you time and money in coordinating and guiding you through the various steps before you reach the closing table which eliminates time and money not to mention stress.

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Dirty little secrets about selling your home for a clean profit!

You need to get rid of 1/3 of your stuff. Buyers cannot see beyond clutter and excess furniture.  Either sell your excess or rent a storage unit and move your things out so your home appears open an airy as possible. Paint the walls bright color in the white tones, open windows and let light in. It’s a proven fact that light sells homes! Clean the windows and brighten up your home and décor. Also buyers need to see themselves in your home so it’s important for your home to be as de-personalized so they can visual their family not yours in the home.

House cleaning is very important as well. A well cared for home that is clean, bright and open is a real motivator for buyers.

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Is It a Condo or Townhouse

A condominium is a housing structure that is a part of a bigger unit or building and the owner of the condo own the interiors independently and the other services in the building jointly with other condo owners. When you purchase within a condominium you are agreeing to follow the rules and regulations that are specific to the community as well as covenants, restrictions and by-laws that govern the community. These rules and regulations are governed by a condominium association with a board of directors from within the community. There is usually a general manager who may be part of a large company off site who orchestrates the day to day operations and maintenance of the building’s exterior and the common grounds of the community.

 A townhouse is a style of housing where a row of identical houses share walls. Here the owner owns the whole unit as such.  Different from a condominium you actually own the land as well as the interior. Usually you own the deck and patio private to the townhome. A Home Owners Association governs the property and will take care of the common area maintenance. The HOA may take care of the exterior maintenance of the building and grounds around the unit but these various with each community. Sometimes they maintain the painting but not the roofs or vice versa so it’s a good idea to be investigated thoroughly before you make an offer to buy.

The restrictions and rules and regulations are also very important to scrutinize before making and offer because they associations on a condo or townhome may dictate a pet policy, or whether your work vehicle can be parked at your home.

As part of the purchase agreement for either a Condo or Townhouse you will be given a period of time usually 10 days to review the documents and resale certificate from the association. I realize it’s a cumbersome process, but it’s one of the most important steps in the process before your buy in to a situation.  It’s extremely important to inspect the communities’ financials, and specifically the defaults and delinquencies.  You do not want to carry other dead beat owners.

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Realtor – Dress for Success in Business

Maybe it’s my age shining through but I find that Realtors are dressing down.  As a Realtor we are in the public eye 24/7. It’s important to dress the part of someone who is successful. The consumer needs to feel good about their decision to work with you. Dressing well not only helps you feel more confident but you gain the respect of the consumer in the process.

Running errands is not excuse for looking like a slob, for that is when you are most likely going to run into a person who ultimately is your next client or buyer!

The vehicle you drive should also give the correct image of success. You don’t need to drive a high end car, but your car should be clean and organized at all times. Image is everything in this business. Dress the part of someone successful and leave the jeans in the closet.