10 Steps To Get The Best Deal On A Home

When it comes to real estate, timing is everything. And if you’re buying this year, your timing is perfect.  Interest Rates are still at Historic lows and lenders are starting to loosen up lending criteria.  Below are 10 steps to make the buying process smoother and help save you money.photo

1. Get pre-approved for a mortgage. Pre-approved, not pre-qualified. Pre-qualified simply means you’re good for the loan — if your income, debts, credit and other factors are exactly as you stated and can be documented. Pre-approved means these things have already been checked and verified. This is always a good idea in any market, especially now. Sorting out the mortgage first will let you concentrate solely on the loan terms, without the added pressure to choose something quickly or risk losing your “dream house.” Since you’re likely to have more options in terms of properties, this step will also help you narrow the field to only those homes you can truly afford.

2. Determine your dollar limit. Decide how much you want to pay, not just how much you can pay. The maximum for which you qualify isn’t automatically the amount you want to spend. You may want to buy less house to allow for a future where one of you might want to stay home with the kids or make a career change.

3. Make a list, check it twice. Another way to narrow your search in a market with many choices is to really zero in on the individual features of your future home. Which items do you really need? Which do you merely want? Which don’t matter? And what would be a deal-breaker? You’ve got to make sure that what you’re looking for is really what you want. If you’re buying the home with a spouse, make up your own separate lists first, then try to integrate them. That way, you approach sellers and agents as a united front — and you’re more likely to get what you want.

4. Do your homework. If there are communities you like, do the in-depth research now. Buyers, especially in a market with a lot of choices, get caught up in finding the “perfect house” and don’t do their research.  Instead, you want to be able to take advantage of the fact that we’ve got a lot of choices.

5. Hire a buyer’s agent. A good real estate agent can help you focus your search and avoid the pricing pitfalls. Don’t fall victim to the trap that you can save money by not using an agent. The seller, after all is paying that agent.

6. Put all extras in your first offer. Negotiations are more elastic in the beginning when the buyer and seller are most likely to want to reach an agreement. It’s a lot easier to include that entire list of concessions or repairs in the beginning than to drop it in at the very end.

7. Leave room for a second offer. Many sellers will assume that if you knock $20,000 off the price the first time around, you’re looking for a counteroffer that will reduce the asking price by $10,000. But it’s a fine line to walk. Offer too little and they won’t believe you’re a serious buyer; too high and you leave little room to negotiate.

8. Have a backup plan. Don’t set your mind on one house and say it’s that or nothing. It helps you remain more objective and you won’t get carried away and pay more for a house than the house is really worth. If you are seriously considering other homes — and could be just as happy with other choices, have your agent convey that point. Be respectful and honest.

9. Call your insurance agent. How will the neighborhoods you’re shopping affect your home and auto premiums? Your agent will be happy to tell you. And it’s even more important since some areas are seeing large increases in premiums in the wake of natural disasters. It’s free knowledge and like the price of groceries in your new community, it all goes into the cost of living and you never think of it until you move there.

10. Educate yourself. Education is more valuable now. People have trepidation and fear because they’ve realized that real estate is now appreciating at normal rates.  But with low rates and decent prices on housing, it’s a good opportunity to get into the market.

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