Regrets can be costly when it comes to real estate. The stakes are high – probably the largest financial commitment most people will ever face. The experts at condoideas offer the following pointers to keep in mind.
- Don’t go it alone: A dependable team can help you through the maze of house buying. From day one, Condoideas can help you choose a lender, a closing agent, an inspector, and other professional experts.
- Put your trust in your own research: Do your research, and accept the recommendations of your own support team. Remember, sellers and their agents are not working in your interest. Decisions should make business sense. This is business.
- Get pre-qualified or pre-approved: While pre-qualification for loans means a lender agrees to provide funds based on verified financial information and credit rating, it adds another benefit: you will know how much you can afford to borrow… and therefore how much you can spend.
- Don’t rely on love at first sight: Try to make a list of your absolute requirements before you begin your search. Then go looking. And don’t stop looking when you get to the property lines. Check out the street and neighborhood at different times of day. Check out resale assets, such as nearby schools, libraries, and commercial districts.
- Don’t Overbuy: Costs don’t stop at the door of the closing agent. Budget for closing costs, moving expenses, redecorating and ongoing maintenance. Think about unfixed costs, like taxes and utilities. Figure your total debt load and keep your mortgage below 36% of your income before taxes.
- Think about resale from day one: You don’t want to be caught out in a changing market, no matter what your long-term intentions are for the house. Low sales prices for neighboring houses will lower your sales price, as will falling housing markets. Note: You will need to cover your mortgage even if you have to sell in a weak market.
- Don’t rely on someone’s word: Oral promises are often made during the walk-through. Is the refrigerator included in the purchase price? If the answer is yes, be sure to get it in writing. Written contracts generally trump oral agreements.
- Read the fine print: At condoideas, we walk clients through their mortgage papers ahead of the closing date. You should have time to ask questions and get answers.
- Include contingencies: Unconditional offers leave open too many doors in a home purchase. Contingencies can protect you. For example, don’t risk the declining of your loan because the house appraises for less than the sales price: insist on a formal appraisal to confirm sufficient equity before you sign. Demand a thorough house inspection as a prerequisite. And make sure you can purchase adequate hazard insurance for the property.
- Expect a “discovery phase”: Even after following the nine other hints above, a period of discovery of the unique quirks of your property will inevitably follow the signing of documents. Don’t beat yourself up if you didn’t spot them all ahead of time.
