WOW Is All We Can Say!
DEFINE WHAT YOU WANT
Start by creating a prioritized list of features you want in your next home and the reasons why. Use it as your search guide, but remember that depending on your funding, you will probably need to make some compromises. In addition, talk to your real estate professional about where you want to live. Location is a huge part of any move. Our agents are trained to help their clients narrow down their choices by sharing market trends and local information like neighborhood statistics and community links.
FIGURING OUT WHAT YOU CAN AFFORD
Now that you know what you want, it's time to see what you can afford. The most effective way to do this is to get pre-approved for a mortgage from a lending institution. This process can often be performed in under an hour and it accomplishes two important goals. First, it will tell you how much house you can afford and what your monthly payments would be. Second, it tells the seller that you can afford to buy their home.
By definition, a pre-approved buyer has an approved mortgage subject to an appraisal of the property. Many times a buyer can use this pre-approved status as leverage during the negotiation process.
TIP: Most sellers require only pre-approved buyers to walk through their door. Also, check different area banks and mortgage companies for interest rates and different programs they might offer. Our agents can help you find the right mortgage for you.
SHOPPING FOR HOMES
Once you know what community you'd like to live in and have an idea of how much house you can afford, its time to start checking out actual properties. Our agents can help locate the right property for you, only showing you properties that will best meet your needs and in accordance with Fair Housing regulations and ethical real estate practices.
Remember to keep an open mind when looking at homes. The way you might decorate is not necessarily the way someone else might do it. Same holds true for housekeeping habits. When looking at a home, picture you and your family living there with your furniture and belongings.
TIP: When comparing homes, make sure to look at all aspects of the property. Is the property tax approximately the same? Are both the houses renovated? Do they both have the same amount of bedrooms and bathrooms? Are both houses located on the same or similar streets?
Also, when seeing properties, only look at a few at one outing. For example: If you see 10 homes in a single day and it takes about 5 hours to see them all, you might not remember what the first house looks like. Or because you are so overwhelmed you mind might blend some aspects of house #2 with house #4. It is best to see 1-3 homes at a time for a clear view and memory of each home.
MAKING AN OFFER
Once you find the home you want, you need to make an offer for the house. Typically this is a very difficult and trying time since both parties have totally different goals. It is better to have a third party, such as a real estate professional, negotiate the offer. If you have any personal interaction with the homeowner, don't give out any information about your move, your current housing status, financial status or your feelings about their property - positive or negative. This could hurt you in future negotiations.
WHAT ARE SOME NEGOTIATING TIPS?
Know the seller's motivation to sell. This will enhance your negotiating position. Sellers who must move quickly due to a job transfer, divorce, or contract on another home, are more inclined to accept a lower price to speed the process along.
Remember, too, that the listing, or asking price is what the seller would like to receive for the home. It is not necessarily what the seller will settle for. So know value. Before you make an offer, check recent sales and listing prices of comparable neighborhood homes and compare them to the seller's asking price. Your real estate agent can do this for you. Other tips:
- Be flexible. Never say, "take it or leave it." That can sour negotiations and ruin the deal.
- Never show your hand or reveal your next step.
- If you plan to pay cash or have a tentative commitment for a loan, use your strong financial position as a negotiating tool.
- Don't let emotions such as pride, fear, love, and anger get in the way of negotiating the best deal. Leave irrational feelings at home.
TIP: IS IT POSSIBLE TO BUY A HOME BELOW MARKET PRICE?
Answer: Certainly, but do not hold your breath. It takes a lot of determination and time to find a real bargain. But if you are adamant, here are some likely targets to pursue: foreclosed property, a fixer-upper, hard-to-sell new homes in a housing development, HUD homes. However, bargains are easier to come by in a soft real estate market, when the economy is in a recession, and when homeowners and builders are desperate to move unsold units.
INSPECTION AND INSURANCE
After your offer is accepted you will need to setup, coordinate and interpret various inspections, including insect, radon, building quality, oil tank, title, etc. You will also need to arrange for homeowners insurance and finalize the mortgage.
This is a major step in the buying process and there are many potential problems that can be discovered during this period. These include a leaky roof, radon gas, termite damage, a foundation problem, and wall cracks, to name a few. These problems happen all the time. The difference between closing on your dream home and starting the process all over again is what occurs during the negotiations between you and the seller.
Your real estate agent can help make these discussions go more smoothly. Near the date of closing, usually the day before, you will also have the option of a "walk through". This is your last chance to make sure that all of the items that you have agreed upon were completed to your satisfaction.
THE FINAL CLOSING
Before you arrive at the closing, make sure all the necessary paper work and deposits have been completed. If the mortgage, title work, homeowners insurance and other items necessary under local and state laws are not completed and brought to the closing table, the closing may not happen on time. Again, your real estate agent will help make sure everything is in order.
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