Top 6 Drop Dead Musts When Buying A Home
1.) Do you want to buy a home? Well unless you are wealthy with tons of cash you will need to get a loan to buy a home. Before you even start looking at houses to buy go to a lender (your Realtor can help you here), and get a pre-approval loan commitment. If you do you will be able to look at homes you can afford and you will not make the mistakes most home buyers make when they start looking at homes they can’t afford even if they think they can. The golden rule is in effect…those with the gold make the rules…so know what you can afford before you waste your time and energy looking at Sunday open houses.
With pre-approval letter in hand – do not apply for any kind of debt! Even if you are buying a fixer-upper or a bank owned home (REO), which will need extensive work, or maybe features are missing and need to be bought before you move in like a stove or refrigerator. Don’t go apply for a Sears or Home Depot credit card either. You will have a difficult time getting a loan if you do. Wait for the close of escrow to get those credit cards and you’ll be OK.
2.) Once you have an amount in writing the lender indicates to you how much they will loan you then you can look at only the neighborhoods you can afford. Know those neighborhoods back and forth. Visit them morning, noon, and night including weekends. Know ahead of time what you will be buying in the neighborhood you can afford. Does it have gangs, are there family disputes ongoing, and is there a school or park that has concert in the evenings or it there a hang out that would adversely affect your life style?
By doing so, you will be better informed to structure an offer, which will be one based on knowledge and not emotion. Sometimes you may have no choice and you may devise a short-term plan that will allow you to build up equity so later you may be able to move to another neighborhood. It could even mean you shouldn’t purchase a home and continue to save money so you can move into a neighborhood more suited to your needs.
3.) Before submitting offers ask your Realtor to do a comparative market analysis (CMA) on the neighborhood. Use only property sold within the past 6 months as your comparable properties. This is because your lender will only use the past 6 months so stay in line with their limits. Give the highest weight to sold properties if possible. They are the truth of the market while homes for sale tend to be a “Disneyland” perception.
4.) Once you have pre-approved for a loan, found the neighborhood you can afford, and did a CMA on a home you want to place an offer on now is the time to give your offer to the sellers. It’s important at this point you “commit and submit” to the purchase of your new home. Stay focus on this home and do whatever’s necessary to get your new home. Granted the purchase should make sense and acceptable to you. If this home doesn’t work out for you then move on and find one that will and again commit and submit to that home.
5.) Once you find a home in the affordable neighbor and have submitted an offer and it has been accepted the work has just begun. Whatever you do, be sure to get inspections on the condition of the home. It is best to go with your property inspectors so you can ask questions about any issues they may find. There may be an issue that you as a new home owner could very easily correct yourself and not cost you much money. On the other hand these issues could be beyond your scope or abilities. You will want to know what needs to be done to correct the issue and how much it is going to cost.
Even if you give a non-contingency offer (I strongly recommend against) get inspections. You need to know the condition of the home. Just think of that movie with Tom Hanks…”Money Pit”. Be smart get your inspections.
6.) If your Lender, Realtor, Inspectors, Escrow Officer and anyone else associated with your home purchase has done a great job and has given you world-class service don’t keep them a secret. Tell your friends, family, work associates, and loved ones about your great experience. Help those who help you get your new home to stay in business. By doing so they will be around the next time you have a need for their services. It doesn’t take much to say good things to people you care most about when it comes to those who have helped you.
Following these 6 Drop Dead Musts when buying a home will make your journey easier. We here at Cliff Keith and Team at |Today Sotheby’s would like to help you make sure these 6 Drop Dead Musts happen during your transaction of buying your home. Give up a call/text/email and let see how we can help you. 650-346-7366. Put our 38 years of experience to work for you Today.
Good luck on your home search and much success.