I’ve been involved in the real estate industry for a significant part of my life. I’ve noticed that there are some common traits in most of the smart buyers. So what makes some home buyers smarter and more successful than others? I’d say they know how to smoothly go through the sometimes painful process of home buying without killing anyone – themselves, the seller, a loved one, or their estate agent.
Here are some effective habits of such buyers.
Getting pre-qualified for loans
Your search for homes cannot be effective if you do not have an idea about your budget. In today’s lending scenario, it’s important to know the type and dimensions of the mortgage you’re eligible for. In some states, it’s mandatory to submit pre-qualification documents along with your offer.
Even where it’s not so, I wouldn’t recommend forwarding an offer without pre-approval. A majority of sellers will want to have some proof that you’ll be able to get a loan. So when there are multiple offers for a home you’re interested in, you wouldn’t want your offer to be relegated to a not-so-favorable-position, right?
You must be clear regarding what you must have, would like to have, and cannot have. Vague instructions like you need a house with 2 bedrooms and 3 bathrooms will not help much. Your agent will go through the MLS (Multiple Listing Service) and maybe see 6000 such homes listed there. You cannot possibly look at all of them.
If you specify a house by adding criteria of your budget, the number of cars you want the garage to house and saying you do not need a pool – things get easier. Now even if the MLS search brings up 30 houses, it’s not impossible to see each of them. Some additional criteria can narrow down the search further.
So you don’t need to wander around aimlessly and you save time as well.
When you hear of or read about being able to acquire bank-owned homes very cheap in an area, you’re thrilled and dream of becoming rich. You think you’ll get such a home for yourself and make huge sums every month by renting it out.
Wake up, banks aren’t stupid. Would you yourself offer something like this if it was your home in question? Bank-owned homes are sold at more or less the prevailing market rates. So if you’re dreaming of a reasonably priced home with a golf course, forget about it. No such homes exist.
You need to be realistic about other things too. If you’re purchasing a short sale, don’t expect the owners to make repairs the home inspector pointed out. It is the business of home inspectors to point out problems and they’ll do just that.
It’s unlikely that you’ll get a home that’s absolutely perfect. This will happen only if you get it built yourself. So if you come across a home that includes all things other than the perfect type of colors, flooring or cabinets, keep yourself slightly flexible. It’ll make your life simpler.
Understand that the sellers are human too. Nit-picking regarding repairs and negotiations is likely to do more harm than good. This doesn’t mean you need to give in to all your seller’s demands. Stand firm on really important issues and be flexible about the rest to get the transaction moving.
When you find a home you love, confirm its value by getting a free home value report from Neighborhood IQ today! It’s absolutely free and incredibly useful! Also, the Home Loan Advisor can analyze your property, current market conditions, local market comps, and other variables in our proprietary algorithm. We can also match you with potential lenders who have products that may help you and provide you with a sense of stability.