Making The Home Buying Decision

Whether this is your first home or one of many you should keep in mind that you have decisions to make and options available to you.  I have put together just a few tips that could make your home buying experience a little easier. 

 ”Pre-Approved”  Vs. ”Pre-Qualified!”

A Seller considers many factors when looking at an offer such as price, time period in which in will close, the ability of a buyer to buy, personal items the buyer is asking for, and if they are going to be paying any part of a buyer’s closing cost.  So it is important to make sure you are in the best position to negotiate when you make your offer.  Step out of your shoes and look at yourself as a buyer from a seller’s eyes.  Putting yourself in the best buying position is going to allow you to negotiate for the best price on the home of your choice.

In the past buyers where told to get “pre-qualified” by a lender. “Pre-qualified” is a term that society has learned means absolutely nothing.  You talk to the loan officer, give them a few details about your income, debt, ect. and then they tell you that you are “pre-qalified”.  If a loan officer has not documented and varified the information given to them, then this process is not worth a thing.  Society is much more educated and sellers want buyers that have been “Pre-Approved”.  A “Pre-approval” puts you as a buyer in a better position because the loan officer has now varified your credit history, your income, downpayment monies, etc.  Your loan is now in place.  You know your interest rate and payment and this link will even give you more insight on saving money.  When a seller sees that the only thing they have to worry about is the appraisal, title work, and inspections they are more likely to be more willing to negotiate with an offer.  As a buyer you have cut the time period to close down by several days and eliminated a huge unknown that the seller does not have to be concerned about. 

Choosing Your Home:

Know what you are looking for by making a list that identifies the needs of your household.  Make a list of everything in priority that everyone wants.  Then as you are looking at property you will be able to indentify the home that offers you the highest number of things you are looking for.  Keeping in mind that some things can be easily changed, such as carpet, paint, cabinets, etc. and you will not know until you are in the home what they are. Things such as neighborhoods, locations, school districts, crime rate are things that can not be change and should be considered before every looking at the home.  Make sure you are choosing the location that you will be happy to call home.

I have said it before and I will say it again, choose a Realtor® you can communicate with and trust.  Communicate all of your needs and desires to your real estate professional so that they have a clear understanding of the amenities and locations that would be of interest to you.  The experience and knowledge that they have in the market place will save you time and money, so let them do their job, but give them the information they need to do it with.

If you are buying in an area that you are not familar with you can do many things to find answers to question about location, crime, etc.  Ask your agent, call the local law enforcement and find out the number of calls to this area in a year.  Drive through the area after 5:00 p.m. or on the weekends and see if you like the atmosphere.  Check the schools out by visiting, asking questions and looking into.  There are many things to consider, but if you have them on your list they will be easy to check off as you go. Choose an area that meets your needs and your desires but do your homework.

Inspections are a common way to eliminate some unkown factors that are not easily seen.  Whole house inspections and termite inspections are probably the most common.  Others would include radon, lead etc.  These inspections can be done prior to the offer or as a contingency in the offer but as a buyer you need to make the decisions which inspections are important to you. 

Buying A Home Before You Sell 

If you need the equity out of your home before you can buy another, your best bet is to sell it first.  Trying to make an offer contingent upon selling your home puts you at a disadvantage in your negotiating power.  The seller more than likely does not know your home and will be resistant to your offer.  They have no gaurantee that their home is sold, no idea how long it will take to sell yours and will not negotiate in the same mannor that they would if this was not a factor.  It is best to sell first and buy later.  Having your home sold could save you thousands of dollars when you are negotiating an offer with a seller. 

You more than likely have the option of making an offer contingent upon selling your home and another option of listing your home contingent upon finding the right home.  But either way, the right home will be available in the right time.  Keep an eye on your options and the market but try to resist “falling in love” with a home until your home is sold.

It is a currently a buyer’s market in most areas but the motivation of the seller and the market you are in are individual in nature, so until you make that offer you are more than likely not going to know where you stand.  Make the best choice for you and make your offer accordingly.  Do not feel pushed to make an offer and do not make an uneducated decision.  This is one of the biggest purchases most people make in a lifetime and should be given a great deal of thought.