1. Hire an ABR Agent: Remember, you’re buying what may be your biggest asset. Maximize your buying power, and avoid making costly mistakes. Hire a good, ABR designated agent, (Accredited Buyer Representative), to assist you. Being related to an agent, or living near one, is not grounds for hiring them. Because an agent has a lot of For Sale signs, is not a good reason to hire them. If an agent has a lot of listings, will they have time to devote real attention to you? Think about it. ABR designated Buyers agents are specially trained to provide improved service to Buyer clients. A good ABR Agent will put you at ease, and clarify the whole process for you. Interview a few, or get a testimonial from one or two of their prior clients, and hire who you get along with. It’s a team effort so it’s important to not only have a skilled ABR agent, but also one you like.
2. Get qualified by a quality lender: Don’t have a lender, or don’t have confidence in your lender? Your ABR Buyers agent will help you find one. Lenders will provide you with information critical to the process, most notably, what you can afford. They will also tell you all about the current programs available to you. Get qualified before you start looking.
3. What about the FHA? The Federal Housing authority is writing up to 40 or 50% of new home loans. Changes to their current policies to be enacted not later than this summer, will lower a sellers ability to pay pre-paids and closing costs, and increase a buyers insurance percentages. They’re all found on the following link.
http://www.nytimes.com/2010/01/20/business/20home.html
4. Everything you need to know about Federal Tax Credits for 1st time buyers, and current owners who want to buy a new home. The following link to a National Association of Realtors®website tells the full story!
http://www.realtor.org/home_buyers_and_sellers/2009_first_time_home_buyer_tax_credit
5. Thinking about buying a multi-unit home? Many first time buyers want doubles or a duplex, or even a triple, to help offset the mortgage, and increase buying power. A grand idea, but I caution you about buying triples. FHA requirements are more stringent with triples which can cause a problem with financing. You will need more money to close than if you bought a double. So, your most uncomplicated choice would be a double, or a duplex. But both are a hot items and becoming increasingly difficult to find. Here, patience is a virtue.
6. Don’t forget about insurance! Insurance is a component of finance, and your insurance agent can tell you everything you need to know. But here are a few things to keep in mind:
a.) If you buy a home in a flood prone area, also buy a bridge policy that covers you for the first 30 days before your new homeowners policy kicks in. (Ask Lakeview residents who bought their home in August of 2005)
b.) All insurance companies are not equal…shop your homeowners policy.
c.) Even if your home was flooded, if it was significantly renovated, roof, electric, windows, A/C, plumbing, etc., you can get a better deal than LA Citizens. Ask your insurance agent.
d.) Buying in a flood zone, before making an offer, get a flood elevation certificate. It could lower your cost.
e.) Buying a flooded home? You had better get a real deal, mold remediation certificate, from the seller.
7. When your agent can’t be there to show you a home: Sometimes schedules simply can’t connect, and you may want to see a home right then and there. What do you do? First, call your agent and have them set up the meeting with the listing agent. If you can’t reach your agent, my advice is to have patience, and contact them as soon as possible. If your Buyer Agent is worth their salt, they will probably return your call/text/email within very short order. Allow your Buyer Agent to handle the show, and eliminate possible problems that can occur if you contact the listing agent directly.
8. When do you make an offer? The answer is straight forward, when you feel comfortable doing so. But I will tell you this, if you really like the home, if you feel that pull to own that home, and it’s a desirable residence in a good location, do not mess around by taking days to make your decision. You stand the chance of losing what you want to another buyer
9. How do you know what you’re buying? The selection of a home is a very subjective thing. It’s emotional, like art. You know what you like when you see it. But the reality is that homes are mechanically complex and they will need to be fully inspected before purchase. If your inspectors report does not meet your needs, or causes you deep concern, you can ask your agent to get you out of the contract with no penalty.
10. How does a Buyer Agent get paid? From the proceeds of the sale as outlined in the MLS by the listing agent, or as negotiated by your Buyer Agent with a FSBO, (For Sale By Owner). You’re normally not obligated to reach into your own pocket to pay a Buyer Agent.