by Becky Flanigan and Noemi Cardoso on April 2013
Buying a first home can be a scary, confusing and stressful process. Many would-be buyers are understandably nervous at the prospect of making the largest purchase of their lives. Rather than diving in and hoping for the best, you should prepare carefully before you begin the house search.
Following some useful tips will help you turn an overwhelming and intimidating experience into an exciting search that yields the right home!
1.) Establishing a Realistic Price Range
A common mistake among first-time home buyers is purchasing more house than they can afford.
You should not rely on banks to determine what you can comfortably spend on a new home. Banks are adept at determining the amount of monthly debt in the form of mortgage, insurance, credit card, student loan and auto loan payments. They have no way of knowing, however, what you spend each month on groceries, entertainment and utilities.
You should make a list of all monthly expenses, excluding rent or your current mortgage payment.
Whatever is left after monthly expenses is the amount available for a mortgage payment and housing expenses such as taxes, insurance and home maintenance. Carefully consideration of your budget saves time by weeding out homes that you cannot afford and guards against overspending.
2.) Seeking Pre-approval
Getting pre-approved for a mortgage prevents a deal on a dream home from falling apart due to failure to obtain financing. You should compare loans from several lenders to see which one best suits your needs. A pre-approval letter will give you some power to negotiate on a home’s price because the seller will view a pre-approved offer more favorably than an offer that comes without lender pre-approval.
Keep in mind that pre-approval is different from pre-qualification. During pre-qualification, the lender estimates what you can afford. Preapproval is a more involved process in which the lender looks at your credit report and performs an extensive financial background check. At this point, you will get a good idea of the mortgage interest rate as well.
3.) Choosing a Real Estate Agent
Off course you can go searching for home on your own but there is nothing better than being supported for a reliable and knowledgeable Realtor.
Your Buyer's Agent will sift through the hundreds of homes and highlight the ones that works better with your need and wants. They will do all the leg work, set appointments, visit properties, find answers to any questions you may have, that way eliminating innumerous hours you would waste in front of computer or looking at magazines.
A Buyer's Agent usually doesn't cost you anything and you can use their expertise in your favor.
They negotiate prices in your behalf, they will make sure inspections and dates are respected that way protecting your interest, they will referred you to reliable professionals if needed be. In short they work for you and not for the seller.
Your best interest is what a buyer's agent have in mind. Check references, read client's testimonials, interview more than one if necessary. Empathy and trust on your Realtor are important factors for your peace of mind.
4.) Setting Priorities
You should compile a list of what you need and want in a house. Needs might include the number of bedrooms, square footage, high-quality schools and commute time. These needs are aspects of the house that either cannot be changed or cannot be changed without substantial cost to you.
Wants, on the other hand, are something you would like and that can be changed. Wants may include a pool or hot tub, landscaping, finished basement or hardwood floors. Making a list of wants and needs helps you focus on what is really important in a house, narrowing the list of prospective homes. Ideally, the new house will include all of the needs and a few wants.
5.) Choosing the Right Neighborhood
Crime statistics, insurance rates, property taxes and school quality are important considerations for you. Because the neighborhood makes up a large part of a home’s value, take your time to find exactly what suits your needs. You should also consider job commute, traffic during rush hour and proximity to amenities such as shopping, churches and libraries.
Driving through the neighborhood at various times during the day and night will provide a more complete picture of the location. Don’t forget to talk to potential neighbors, who can be a good source of information regarding the neighborhood and residents in the community. Take note that bad neighbors can bring down the value of a house.
6.) Finding the Right Home Inspector
You will also need a professional home inspection. Even new houses may present costly problems evident only to a home inspector.
You should talk to several inspectors before hiring one. You should ask about the inspector’s qualifications, scope of the inspection, how long it will take and the nature of the report you will receive at the end of the process. Main areas covered by the inspection should include quality of construction, integrity of the foundation and condition of plumbing, electrical, heating and cooling systems. If the inspection uncovers serious issues, such as cracks in the foundation, you may decide to back out of the contract or ask the seller to repair the problem.
If you are ready to start looking for you new home, please feel free to visit my personal site at
www.DistinctiveHomes-NE.com and see what my past clients have to share click on Testimonials on the left banner.
Call now for a private appointment to determine what your needs and wants are and get you in the right path to the American Dream of Homeownership.
Noemi Cardoso
William Raveis Real Estate
911 Main Rd - Westport MA 02790
Serving MA & RI
Cell: 508-558-1945
www.DistinctiveHomes-NE.com
Noemi.cardoso@raveis.com
Becky Flanigan is a former real estate professional with over 13 years of experience. She currently writes at CharlesBarnes.com as well as other sites. She has taught many real estate courses and is committed to offering sound, real life advice.
Most FSBO sites say you can save the commission by selling on your own. What happened in Sambrotto’s sale?
I’ve put together nine tips I think make all the difference for a positive outcome. These are tips I’ve gathered through experience working with both buyers and sellers and from witnessing the processes that make deals happen.
- Hire an awesome real estate agent. You make think this is a
shameless plug for the profession, but I believe your odds of success greatly
increase when working with a pro. Notice I said AWESOME, not just any
agent. When buying a home in seller’s market, you will need to act quickly, be
well educated, and have professionally written offers. An agent who knows the
area and the local agents will help you find a home and advise you on the right
offer.
- Learn the process. Don’t wait until the day you find a home you want
to learn the process of writing an offer and buying a home. It can be a steep
learning curve. Know what you will need to do and how much it will all cost
ahead of time. If you follow step one, your awesome agent should provide a
thorough education.
- Get pre-approved. I don’t want to hear why you haven’t done this
yet. If your agent is nagging you about this, good! The mortgage process is
more elaborate than a few years ago, so get your ducks lined up and marching.
In a multiple offer situation you will likely need to present a pre-approval
letter and not having it ready can make the difference between acceptance and
rejection. Regardless of how strong you know your finances are, the seller will
not know and a pre-approval is the only way to communicate it.
- Prepare for some disappointments. When buying a home in a sellers’
market, it is likely you will have a rejected offer along the way. I met a
couple who gave up on searching for a home when their first offer on the first
property was rejected. This is a mistake. Don’t fall into the emotional
pitfall of turning a disappointment into a defining moment and base decisions on
it. Move on, keep going, expand your horizons and know it was not the right
property for you. But if you continue
to lose to better offers, it’s time to change strategies.
- Start the process early. Want to move in September? Start looking
in March….you should have started weeks earlier. With low inventory and more
competition, the search takes a while. Furthermore, a long closing may be
highly valued by a seller who still needs to buy a new home. Let’s go!
- Find flexibility. Find your strengths as a buyer. Do you have a
great knowledge about construction and plan to fix things? Then don’t be picky
after inspection. Do you have lots of cash? Maybe waive the appraisal
contingency or offer a larger down payment. Are you flexible to move anytime?
Make it known. A flexible closing can make a big difference for some home
sellers who need to move in a particular time frame.
- Know your weak spots. If you have a 3-5% down payment, you may have
a tough time competing against some of the investors paying cash for
properties. The questions is: how to overcome those weaknesses? You can offer
more money, tight mortgage contingency timeline, etc. An offer to purchase real
estate has many elements to it, and you need to know your strengths and
weaknesses, and how to work with them.
- Brush up on your writing skills. A short note goes a long way. I
often advise buying clients to write a personal note addressed to sellers
telling them a bit about themselves and why they like the house. You’d be
amazed how a personal connection means more than a couple thousand dollars in
some situations. And it can make a big difference when two offers are very
similar.
- Ask your agent to present the offer. I admit to overlooking this
detail sometimes, but having a buyer agent present the offer is another great
way to make the connection more personal. It also ensures the sellers receive
your perspective when the offer is presented rather than the listing agent’s
editorial remarks.
Was this helpful? Find more helpful tips to strengthening your negotiation power when buying a home in a seller’s market in my blog.If you are thinking of buying a home in Westport or surrounding areas please visit www.DistinctiveHomes-NE.com for a free list of homes for sale in Westport and Bristol County MA and RI.
If you are thinking of selling your home contact me for a FREE Current Market Analysis and to learn about our Market Plan to get your home SOLD!
We work with one going in mind, YOURS!
Local Office. Local Agents. Local Knowledge.
911 Main Rd - Westport MA 02790
Cell: 508-558-1945
www.DistinctiveHomes-NE.com
noemi@DistinctiveHomes-NE.com
(*) Ruth Lerner is a Brookline Realtor specializing in Brookline, Mass., Chestnut Hill, Mass., Brighton, Mass. and West Roxbury, Mass. real estate. Since 2002 she’s represented both buyers and sellers with a post-transaction satisfaction rate of 97%. You can contact her on her website, and find her on Google+, Facebook, LinkedIn and Twitter.