People have been purchasing homes literally since the first Cro-Magnon man (or woman!) traded a woolly mammoth tusk for a small starter, 2 bedroom cave. A lot has changed since then, but several of these little discussed home buying tips still apply. This week, we’re going to take a look at The Top Ten Most Important Thing All Home Buyers Must Understand!
Top 10 Tips All Home Buyers Must Understand
10.) Set A Realistic Budget…And Stick To It!
So many potential homebuyers fail to truly understand how much home they can reasonably afford. Most all lenders will place restrictions on the amount a buyer can borrow, referred to as the debt-to-income ratio, in order to prevent homeowners for digging themselves into a financial hole. Ascertain exactly what type of mortgage payment you are truly comfortable with; after all, you could be paying it monthly for up to 30 years!
9.) Refrain From Buying Big-Ticket Items Before Purchasing A Home
Considering the purchase of a new home in the near future? Now wouldn’t be the best time to go out and purchase that new luxury car or finally making that decision to go to graduate school! In fact, this would be the perfect time to start saving money, if not for the down payment on your new dream home, at least to show lenders you have a cushion in your bank account.
8.) Definitely Get Pre-Approved
Before you visit your first open house or even search online for available homes for sale, it’s advisable to get pre-approved from a reputable lender. It’s always best to understand how much money a well-respected lender is willing to provide prior to discovering that perfect house, only to be disappointed that you won’t be able to make the purchase.
7.) Make Sure Your Eyes Aren’t Bigger Than Your Stomach!
We’ve seen it way too often—potential homeowners that feel compelled to look at properties that are simply too big for their needs. With your last child “leaving the nest” do you really need a seven-bedroom house? Granted, you may be able to easily make the mortgage payments, but you just may quickly discover that you have no true need for all of that square footage, which leads to our next point…
6.) Know There Will More Expenses Than Just The Mortgage
Your monthly mortgage payment is just the tip of the iceberg. You will still need to heat the home in the winter and keep the air conditioning at a comfortable level in the summer. That yard isn’t going to mow itself and just how many more years does that roof have in it before it needs replaced? And don’t forget about any HOA Fees! It’s important to budget for all of these traditional expenses every homeowner must consider.
5.) Now Is The Time To Follow Your Head, Not Your Heart
People often relate finding the perfect to falling love, which it definitely can be, but, more importantly, use logic. Just because you’ve found the ideal home, and you’re already visualizing how you will decorate the living room and finish the basement, you must play devil’s advocate! As you dig deeper is the house a money pit? Is it an extra 45 minutes from your office? Maybe it’s not in the best school district. There’s an entire laundry list of things you must consider other than just how the home makes you feel.
4.) Learn How To Make A Proper Offer
Just because you were pre-approved for a certain amount, and the asking price on the property you’ve selected falls within the parameters, this doesn’t mean you simply say, “I’ll take it!” A proper initial bid requires what not only what you can afford, but what you personally believe the value of the house to be.
3.) Don’t Try To Beat The Market
This is a real rookie mistake! Yes, you should keep an eye on the interest rates. Definitely you should investigate what comparable homes in the neighborhood have sold for and certainly you look for a deal, but if you’re waiting for the perfect moment to purchase a house you run the risk of never buying. Purchasing a home involves the ability to examine a wide variety of topics, all of the above included, but knowing when not to pass up an opportunity “just in case”.
2.) Drop By Unannounced
We’re not suggesting you surprise a home seller by knocking on their door uninvited, but you should drive through the neighborhood frequently during different parts of the day. You may discover what seemed like a peaceful cul-de-sac becomes party central after 6:00pm! Maybe the quaint tree lined avenue is actually a major thoroughfare during the morning rush hour. You may find that the home is exactly as you originally imagined it to be, but you’ll never truly know unless you check it out for yourself.
1.) Choose Your Agent Carefully
The most important decision you must make before searching for a new home is to find a seasoned real estate agent. Not only can the right agent help you with everything on this list, they are also required to provide fiduciary duties to their clients, ensuring that your best interest is always first and foremost during the entire process!
Are you ready to begin looking for your new home? If so contact Coldwell Banker Innovations at 301.745.1500! We can match you up with an agent to help you from the initial stages of your home hunting, all the way through closing!