October brings all treats and no tricks when it comes to real estate! Besides great treats in the real estate market, October is also an excellent time to share our thankfulness for and with our
10 Things to Know BEFORE You Buy a Home…
Dated: June 1 2020
So you’re ready to buy a home, but you’ve heard it can be stressful. Well, not for you because you have come to the right place. You have found the checklist of what to do BEFORE you buy a home.
1. Clean up your credit and prepare financially.
This is the most important thing you can do to buy a home. It takes some planning, but here is a list to help.
Credit Cards and Bills:
Always pay your bills on time and pay more than the minimum. Paying in full is best. It’s ideal to never carry a balance more than 30% of your credit limit.
Use your credit cards as if they were cash. Only charge what you have the cash to pay for each month.
Don’t open or have a lot of credit cards. Keep your cards to only a few.
Take steps to reduce monthly payments. Having too many loans with monthly payments can reduce your chance to get a good mortgage loan.
Review your credit report. Check for any reporting errors.
Know your credit score.
Work on improving your score if necessary.
Set your own target budget. How much home you can truly afford (considering your income, debts, down payment, and lifestyle) while maintaining your desired lifestyle? Consider what the monthly payment will be.
Save for a down payment (see #3 below).
Budget and plan for costs when purchasing a home (there are costs outside of the purchase price like movers and furniture, and you may have other transitional costs, such as rent, storage, etc…)
Mortgage Lenders and Rates:
Research for the best mortgage lender and mortgage rate. We can recommend our preferred lender.
Don’t make large purchases while under contract - it could ruin your loan approval.
2. Find the right home for you. Define your goals, needs, and requirements, such as:
Your target move date
Important features of a home, including needs and wants
3. Save for a down payment, but know it doesn’t have to be a full 20% Down.
There are many different loan programs available where you can have a down payment as low as 3.5%-5% of the home’s purchase price instead of 20%.
For example, on a $350,000 home, 20% ($70,000) could be 3.5% ($12,250) down instead.
4. It’s not always as easy as they make it seem.
In a perfect world, you’d only have to look at 3 homes, choose one and move in. Sometimes it may only take 3 homes, but often you will look at many more. We also suggest you look at the home you want to purchase more than once.
Additionally, recognize that a home most likely won’t meet all of your needs and wants. If you find a home that meets all of your needs and most of the want list, it should be considered an option.
Know also that after you’ve selected a home to buy, there are many steps you will go through before you get to the closing table.
5. Don’t get caught up in the trivial.
It’s easy to dwell on everything you dislike in a home. Try to see the potential. If something can easily be cleaned, changed, fixed, painted and so on, don’t let that get in the way of a great home.
6. Home Inspections WILL always reveal issues.
Having your home inspected is a very important part of the process. Don’t be alarmed when the home inspection report reveals many items that need addressing. There is no perfect home, no matter how well it was maintained.
Don’t fret over the little things, however, do not neglect the little things can become much larger if you ignore what needs to be addressed.
Some of the major priorities in a home inspection are safety concerns and the larger, expensive items. Consider them the big five: the roof, electrical, plumbing, HVAC, and foundation. These are the key areas we typically recommend focusing on because repairs can cost thousands and impact your family’s well-being. They are also where an inspection proves to be most valuable.
7. Trying to get a good deal in a seller’s market may be difficult.
First, what is a Seller’s market? A Seller’s market is when Real Estate conditions favor the homeowner who is selling a home. Typically, it results from there not being enough homes for sale to meet the demand from home buyers. Competition is fierce among home buyers and it makes a home buyer ready to pounce when a new home is listed.
When a home is priced correctly and presents itself well, it will sell fast. More times than not, several home buyers will do whatever it takes to “win” the home where you often see buyers offering above a home’s list price. This type of offer is even more common when a home buyer has lost on a home they wanted so this time, they’re not going to lose. That’s your competition. Now, there are always deals to be had but it’s usually not the perfect move-in ready home in the popular neighborhood. So, it’s up to you to decide what you want more, the perfect home or the perfect deal.
8. Not every real estate market is the same as the news may report.
There are different Real Estate markets and simply because the news claims there’s a certain type of market, don’t assume all cities and neighborhoods are the same. Real Estate markets will vary. Your neighborhood could be experiencing a buyer’s market while your city as a whole is experiencing a seller’s market. Knowing the different markets will help you employ different home buying techniques that your skilled Realtor is knowledgeable about and will explain to you.
9. Buying a home directly from the listing agent does not benefit you.
You will not save money just because you worked with the listing agent. A Real Estate agent and their brokerage establish the commission to be paid before a home is even put on the market for sale. This percentage commission agreed upon by these parties is then split if there is another agent, such as a buyer’s agent should you choose to have one represent you in the home sale. If you aren’t working with a buyer’s agent and go with a listing agent’s guidance, the listing agent would receive the full commission, thus, no savings passed on to you.
10. Find a great buyer’s agent.
Why work with a buyer’s agent?...
Purchasing a home is more than just writing an offer. You are making what could be the largest purchase of your life, and hiring the right buyer’s agent is very important. Your buyer’s agent will guide you from the initial consultation until closing day and beyond. If you’re concerned about paying for a buyer’s agent, no worries. In most cases, the buyer’s agent commission is paid for by the seller.
Who you work with matters and what makes Martin Realty Group different….
Choosing the real estate agent to represent you truly matters. With the right agent by your side, you gain a trusted advisor, an advocate for your family’s best interests, and a lifelong real estate resource. Why are we different from other agents? Your needs come first – it’s as simple as that! You are not just another transaction. Our business and reputation rely on referrals from happy past customers and providing you with a real estate experience that exceeds your expectations is very important to us. But there’s more to it than just that – the hours of training to fine-tune our industry knowledge, the extensive real estate coaching network (including some of the most successful agents in the nation) we are a part of, and being a local real estate expert (with the numbers to back it up) all come together to help us serve the needs of our customers in the best way possible. We honestly love what we do, and feel honored that we are able to help so many people begin their next adventure through the purchase of a new home.
Finding and purchasing the right home can be a great experience when having this knowledge before starting the homebuying process. Instead of saying, “I wish I had known…,” you’ll be enjoying your new home.
Deanna has degrees in Communication and Journalism and over 25 years of experience in customer service, advertising, marketing, communication, instruction, training, and public speaking. With this ba....
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