Before you sign up to buy a home, there are a number of things to consider. It is important to do your own due diligence as well as referring to a Realtor's knowledge and training.
Buying a home is probably among the most memorable and exciting times for many people.
1. As a buyer, it is a no-brainer to use the advice and guidance of a Realtor. The seller pays commission to the Realtor, so it costs the buyer nothing. The Realtor is there to answer your questions and there are no stupid questions. The Realtor is there to help you, so ask whatever questions you have or voice any concerns.
2. Do some research on the areas where you might want to live. Think about how far you might we willing to drive from work or from family. Other aspects that you might need to consider include: flood zone, schools, hospitals or health care, convenience to grocery and pharmacy, crime, noise, restaurants, etc..When buying a home, think of your needs a few years in the future too. A home that might be good for your current needs should also be one that will carry you through then next 4-6 years. Location is of utmost importance. You can likely remodel or update aspects of the home, but you can't pick it up and move it.
3. It is important that your credit score is in place and that you have enough saved up for the down payment and closing costs. See my blogs on credit scores and closing costs. If possible, it is best to aim for at least a 20% down payment so private mortgage insurance isn't added. Set a limit of the maximum you are willing to pay for a home so that you still have enough left over to do any personal touches that you might want to do immediately, such as painting or adding ceiling fans.
4. In this market, homes are selling very fast. Be ready with pre-approval or proof of funds before seeing properties. If you are ready for your Realtor to submit an offer for you to buy a house, this information is needed with the offer contract, so you don't want to waste any time trying to get that information at the last minute.
5. When viewing homes with your Realtor, it is important to keep emotions in check. Many homes have Alexa or Google or Nest devices and cameras. If you are overly excited about a home, it diminishes your Realtor's negotiating power. It is best to not say too much, good or bad, about the home while you are touring it.
6. Check the home owner's association or neighborhood code restrictions so you know what is allowed or not allowed. You don't want to have any surprises after the closing. For instance, you may not be able to park a boat outside of the home, or trash cans must be pulled up by a certain time.
7. A home inspection is always advised. The Realtor can advise of companies that can do this important step as well as a WDO (wood dwelling organisms) inspection. The focus of the home inspection should be the roof, A/C, plumbing and electrical and any mold evidence. A 4 point inspection report is needed for most insurance companies, so request this too. Unless you are buying a new construction home, there are likely going to be things that are flagged on the report. Most of the time, these aren't a big issue and there is potential to negotiate or make an addendum to the contract.
8. Make sure to follow the terms of the contract. Send the escrow deposit to the title company. Submit mortgage application on time.
9. If the home will be financed, the mortgage company will order an appraisal. This fee will be included in the closing cost.
10. Homeowner's insurance will be required if the home is mortgaged. Flood insurance is also required. The insurance company will likely need the 4-point inspection from the home inspection. Even if you are not financing the home, insurance is peace of mind.
11. Watch your spending once you are under contract. Any large purchases could affect your credit rating and ultimately your mortgage. Hold off on vacations and buying that new car until after you have closed on the home. Make sure not to miss any payments on accounts or move large sums of money that might raise any flags to your credit.
12. It's a good idea to drive by the property at different times of day and night. You don't want to find out later that the neighbor practices with his band at nights when you have to get up early the next morning, for example.
Coldwell Banker Realtor
ph: call or text 727-430-2350
St. Petersburg, FL