Home Buying Tips
Buying a home is a big deal, whether it is your first home or you've lost count, the purchase of a home changes your life and sometimes your lifestyle. Keeping this in mind there are many things to consider, mistakes to avoid and joys to be had.
10 Things to Consider When Purchasing a Home
#1 Buy the Right Home for You - Sounds easy, but sometimes the emotion of buying a home outweighs all logic. Clearly identifying your needs and wants before shopping is a key step in making the best decision possible. There are thousands of homes available on the market every day, and although many of them are beautiful homes that are easy to fall in love with, if it doesn't meet your needs, then it is not the right home.
Write down your wants and needs and shop as objectively as possible to fit those needs and wants into your budget.
#2 HOA, Restrictions & Covenants - It is not only important to buy the right house, but to buy into the right neighborhood for you. Restriction & Covenants can be very limiting and strict, this has numerous benefits, but also will limit your use of your new property. If you are envisioning a nice tall privacy fence for your own backyard oasis but the HOA doesn't permit privacy fences, this is something you will want to know before you make your final decision. Read the Covenants and Restrictions to ensure you are buying the right property for you.
#3 Realistically Consider Your Budget - Although we rely on the bank or mortgage brokers to tell us how much we can afford, based on our income, our debt and our credit, we must look at our own budget as well. The bank might not know about our love of shoes or daily Starbucks habit. By taking into account your personal budget, you will be happier in the long run, because you will have made an informed decision on how your home purchase might impact your lifestyle.
#4 Have Money Set Aside for Closing Costs - Even on Zero Down 100% financing loans, there are closing costs that you will incur. Closing costs will vary depending on the loan type and seller contribution, but there are always some out-of-pocket expenses that you need to be prepared for. In addition to closing cost you should be prepared to pay for a Property Inspection, a survey, title insurance and homeowner insurance premiums.
#5 Do NOT Under Any Circumstance Make Purchases on Credit until After Closing - A common and costly mistake many homebuyers over look, is that a Pre-Approval is not the end of the mortgage lending process, it is just a snapshot in time. Prior to closing the lender will review your financial information again. If changes have occured your approval can change. The best approach is to avoid all credit purchases, avoid any changes to employment and any activity that would change your "financial snapshot" that was taken during the pre-approval phase.
#6 Research Mortgages - Not only is it a lot of money, it is also a loan that you will have for many, many years, so researching the current rates, terms, different type of loan programs and the pricing structure of your selected mortgage company is very important. There are many loan program and options, finding the one that best fits your needs can save you money now and in the longrun.
#7 Contract to Have an Option Period - An option period is a specified period of time in the contract (usually 7-10 days), when you have the opportunity to have a professional inspection of the property. During this period you can obtain financial and tax advise as well. A nominal fee is paid to the seller and is credited back to you at closing. During this period you may cancel the contract for any reason, even if you just change your mind. If you do cancel the contract the option fee is non-refundable.
#8 Consider Re-Sale When Buying a Home - Although it may be your dream home today, 10 years from now your needs and wants may have changed. Being able to sale your home is vital. Real Estate is an investment, even when it is your personal home, as with all investments you want to know you can cash out when you need or want to.
#9 Location, Location, Location - The neighborhood that your home is located in is just as important as the home itself. Looking at the neighborhood at different times of day (and night) will ensure that there are fewer surprises down the road. The sirens wailing, the road noise, the 25 mph school zone and the apparent block parties are just a few of the things you may experience by visiting the property at different times of day. These things not only impact your enjoyment, they may also impact your re-sale should that time come.
#10 Last but Not Least, Hire a Realtor - Selecting a Realtor is an important step that should not be overlooked. Your Realtor is your Teammate through the entire process. Working together with your best interest in mind is your Realtor's Job so choose wisely. I look forward to the opportunity to earn your business and trust and would love to be Your Realtor.
If you are looking to buy a home and these buyer tips were helpful to you, please give me a call @ 512-820-6650!
