November 09, 2009

Are You Ready To Buy A Home?

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Many buyers think that there are just three steps to buying a home. Look at houses, find a house you like and buy it!

There are actually quite a few more steps and educating yourselves on the process might be the single best thing you can do. Buying a home can be an overwhelming, stressful time, but if you have an understanding of the process and know what to expect, you might actually enjoy it. Working with a REALTOR^® who can assist you step by step throughout the process is important as well.

First and foremost you need to address your financial situation. Make an appointment with a lender. They can help determine how much of a loan you can afford, what types of loans you may qualify for, and can get you a “pre-approval” which will get you started on your search for a home. Allowing you to zero in on only those homes that you can afford to purchase!
Now that you know “how much” of a home you can afford, you should sit down and identify your actual needs in a home. If you are purchasing with a spouse or partner each of you should separately sit down and make a list of all “must haves.” Compare your lists, discuss the differences, and come up with a joint list that you can both live with.
If you are moving to a different area, it will be important to research the communities in the area that you are moving to. If you have children, for example, you may want to contact the schools and find out about the programs that they offer. Find out which communities fit your wants and needs and make sure to visit them.
You will also want to be sure you know what property types you are interested in.
As you will be a buyer, competing with other Buyer’s in the market, you will need to do some research. Your REALTOR^® may be the best source in helping you with this step. You need to look at properties that fit the description of the property you have identified as what you are looking for – find those that have sold, those that have expired and those that are actively on the market. This data will tell you what other Buyer’s have been willing to pay for similar homes (the solds), what prices other Buyer’s have rejected (those expired) and what is currently available on the market. This is an important step in understanding and being able to negotiate a price on the home that you find to purchase.
Next you are ready to start looking! Starting your search online will help you to identify properties that may fit your criteria and eliminating those that don’t.
Once you have picked out a list of properties that you think are appropriate it is time to make appointments to see them. Your REALTOR^® can make the appointments for you and show you all listings no matter who the listing agency may be.
After each showing, you should take the time to evaluate the property that you have just seen. When you are in the process of looking, especially if you have scheduled several showings on the same day, one home can blend into the next. Be sure to take the time after looking to make notes – if it is a possibility write down the positives and the negatives. Bring your camera and take pictures so the property is clear in your mind. Once you start looking at properties you may need to reevaluate your wants and needs.
The next step is potentially the hardest one of all – DECIDE which home meets your needs.
Next, your REALTOR^® will help you to write up and offer and negotiate the price with the seller. Be prepared for the possibility of a counter offer, or counter offers!
Once you and the seller have agreed on price and terms of the sale you will need to conduct your inspections.
Your inspections may be fine or they may reveal a defect or defects that you had not anticipated. Should something unexpected arise from the inspection you may then need to negotiate with the seller on the repairs of those conditions. Just a word of caution, not all sellers are prepared or are willing to pay for repairs.
You must make sure that all contingencies, or stipulations, of your contract have been met. There are some very strict deadlines on a Purchase and Sale Contract. Make sure that you follow those dates.
Once all contingencies have been met, it is time to arrange for the move.
The final act is to close the deal and move in!

The biggest mistake buyers make is skipping steps 1-6. Knowing how much you can afford and having a good idea of what you are looking for will help eliminate wasted time looking at homes that you cannot afford. As well, if you are looking in an unrealistic range, the houses you actually can afford may then seem completely inadequate after looking at the higher priced homes, and you may feel let down and frustrated. Set your expectations realistically by doing your homework ahead of time! Buying a home, especially your first home should be a fun and rewarding experience! Be prepared and ENJOY!

Posted by:Michele Penner