home buying?
by Mortgage Rates on Tuesday, October 5th, 2010 | 6 Comments
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KEEPING yourself from “getting screwed” is almost guaranteed if
you find and “hire” an EXCLUSIVE
buyer’s agent.
I can help you find one if you do not
find one.
[do NOT permit DUAL agency--do not
let the anyone who represents you
to also be the one who lists a house
that you are interested in]
First, go to some Open Houses and see the various neighborhoods that you might buy a house in. Check out the local advertising magazines and look for a few houses in your price range. You do not need to have a Realtor to go to an Open House or to view a house on the market. Don’t accept the first real estate agent you meet. Meet with several. They have to understand what YOU want and not just what they want you to see. There are some great agents there, so look around first. Don’t let anyone tell you you can afford a bigger/more expensive house. Check your budget carefully and don’t forget insurance and property taxes and maintenance. Be very clear about your price, your style, and the exact items you MUST have (and be honest about the ones you would only like to have). If you can’t afford the upkeep on fancy items (like a pool), don’t even look at houses with a pool. If an agent offers to show you houses and the houses they show you are unacceptable, dump them!
Once you find a house you like, make a reasonable offer. Don’t offer 25% less than asking price and expect anything but silence back. But do offer what you think the property is worth (even if it is less than asking price) and be willing to negotiate upwards if you really want the property. Be WILLING to WALK AWAY if the price is too high. This is a buyer’s market, so be a buyer. If you do come to an acceptable price DO NOT buy any property AS IS unless you are a contractor and are willing to fix any hidden problems yourself. Do not take the word of a Realtor or seller on the condition of the property. Get an independent house inspector. It is worth it! Read every word of the contract, especially the parts about what is included (refrigerator, oven, curtains?). If it is not in the contract, it is not included. Be aware of all the relevant dates and how much more money you might be charged at the close of escrow. When escrow closes, inspect the house and make sure that everything that was supposed to be there, is there, and that the house is clean and ready to move in. Once you find a house, ENJOY IT. It’s yours.
If you buy an existing house make sure you have an inspection done by a certified inspector and get a certified appraisal. Make the seller bring everything up to top notch condition. Ask for rmore than you think they might willing to do, you just might be surprised.
If it is new construction hire a buyer’s agent and negotiate as hard a line as possible. Expect the builder throw in everything you can think of until they balk.
There is a buyers market in the US right now. You should be able to negotiate an incredible deal. Just be tough, it is your money after all is said and done.
Ok, I have a ton of info on my website but here are a few things that I would advise…
1. Don’t use the same agent that is listing the property to represent you as the seller, the listing agent only has the sellers interest at heart.
2. Don’t shop interest rates only, mortgage lenders make money from rates and fees…Choose the best combination for YOU. Sometimes the lowest rate doesn’t always mean the lowest monthly payment.
3. Have a home inspection done by an inspector that YOU choose and pay for.
4. Don’t trust the appraiser that a lender chooses, if your lender won’t let you choose an independent third party appraiser then RUN. (you do want the true value, don’t you?)
5. If the lender won’t give you a Good Faith Estimate upfront, RUN
6. Rates change and they are only good the day they are quoted…compare different lenders on the same day within a two hour time frame (yes, they do change that often)
7. Find a good buyer agent, I know…I said that earlier…but I had to tell you this twice…a good buyers agent is worth GOLD!
I am a TX based mortgage banker, if you have any questions, please feel free to call me at 214-432-1062.
I plan to do the same in a week when I am there. Maybe we can share looking experience. Email me what you intend to buy . I know this stuff. The most important step is step one; find the place at a good price. The rest is mostly about the money you need to borrow. There can be some concern over clear title, flood plains and hurricane insurance. Be sure to learn how to use google.earth.com for the elevation and the longitude and latitudes.
Try to keep it as a business transaction and don’t let your emotions sway you. You will be on an emotional rollercoaster and some agents,Realtors and others will take advantage.
Get your Credit Report, have 20% down (regardless of good credit or not) and have $3,000 for closing costs. Get preapproved,not prequalified for a loan (no not the same thing). Next interview 5 agents, ask plenty of questions and if an agent hesitates, skip him. Make sure you are comfortable working with that agent I can not stress that enough!
Next, make sure your agent shows you homes that are in your price range and below. Do not let them talk you into something you can not afford.
Learn how to read a settlement statement as this is where you can lose your shirt on fees that you don’t have to pay. If you don’t understand the statement ask the Escrow Officer to explain not your agent. Agents do not know what all the fees are about. If you have a good Escrow Officer she/he will explain everything to you. You might also note that settlement statements constantly change even at closing. You may have to bring in more money but also know that a good Escrow Officer has padded the transaction so that in case it falls short it won’t hold up the process..