Wednesday, July 30, 2008

5 things to do BEFORE you buy a home

1. Get pre-approved for your Mortgage

Get pre-approved by a lender before you go looking for houses. Failure to qualify for a mortgage is the number one reason why houses "fall out" of escrow. You can eliminate this risk (and make your offer more attractive to sellers) by getting approved for a loan subject to finding a property. Besides, most contracts are going to call for you to show an LSR (Loan Status Report), so you might as well get a head start. In addition, you may find that what you qualify for and what you're comfortable paying are not the same. This step will help to ensure you're looking at homes you can afford, and you can afford the homes you're looking at! Give me a call if you need a recommendation for a good lender - I know a few who do great work!

2. Read the Consumer Bill of Rights and the Buyer Advisory

The Arizona Department of Real Estate provides these two documents, both of which are chalk full of valuable information and links to other great websites. While the reading may be dry, the information is important. Click here to read the Consumer Bill of Rights, the Buyer Advisory, and a previous post I wrote about the two of them.

3. Decide what's MOST important, and what you're willing to give on.

Are you buying based on the Neighborhood? the Price? the Floor Plan? the Features? Understand that the combination of these variables will ultimately determine the availability of your dream home. You can save yourself a lot of time and emotional energy if you can identify what is most important to you. This is very easy for some buyers, while others aren't exactly sure until they've seen a few examples and "kicked some tires." I've written before about the 5 Criteria to Consider when buying a home - you may want to re-read that post as well.

4. Hire a Realtor

Buying a home without a Realtor makes no sense to me at all. The current MLS arrangement calls for the Sellers to pay their broker, and for their broker to then pay the Buyer's broker. This means that working with a Realtor is FREE for Buyers!

And what do you get in exchange for the steep price of FREE? How about access to millions of pieces of data, and the tools & expertise to turn those pieces of data into useful information. How about a wealth of experience helping other Buyers (and Sellers). How about knowledge of the marketplace and current trends, from someone whose finger is on the market's pulse? You also get somebody in your corner who knows the contract inside-out, every line, which will give you the legal guidance you need. And you get somebody who practices negotiating contracts regularly. In the end, you get a professional looking out for your best interests, and you get it all for free. When was the last time you got so much for so little?

5. Communicate with your Realtor

Honest, open, and frequent communication is very important. Your Realtor is committed to serving your best interests - that can be hard to do if he doesn't know what your best interests are! Is there a home you've seen that you really want, or one I've shown you that you don't like at all? Contact me as often as you'd like - phone, email, fax, smoke signals, mental telepathy.. whatever works best for you! You're not only welcome to get in touch, you're encouraged to!

Buying a home is a big deal; it's the single largest purchase most people make in their entire life. But if do these 5 things, you'll have a smoother transaction with less stress, fewer surprises, and more control over the process.

Your looking forward to helping Realtor,

Chris Butterworth