Buying a house might actually be fun when you take care to protect your interests.
So you're ready to buy a house. What an exciting time, but also a confusing one. If this is your first home purchase, you probably have lots of questions. But even if it's not, a few best practices can make the whole process go more smoothly.
Here are three strategies that can help you find the house of your dreams and move ahead with the purchase with confidence:
#1: Get Prequalified for a Mortgage
Some housing markets have low competition, and in others competition is fierce. If the demand for good housing is high in the area where you're looking to buy, you'll need every advantage to get the jump on other buyers who might slip in a bid before you can. But even if competition is low, having all of your financial ducks in a row makes looking for a new home a lot less stressful. Get prequalified for a mortgage, and you won't have to wait before making an offer.
A pre-qualification also helps you shop within your means, says Investopedia. You'll know how much house you can afford going in, so you won't waste your time or that of your real estate agent by looking at homes that don't fit. You might also learn that you can afford more than you thought, which broadens your search possibilities.
Your real estate attorney has no loyalty to the seller or the lender; he represents you.
#2: Hire a Real Estate Attorney
Your buyer's agent is well-versed in all things real estate. But she's not a lawyer. Not only that, Realtor.com says her commission cut typically comes from the seller's agent's commission. Although you'll have a written agreement with your agent, you need a lawyer who has only your best interest at heart.
The lawyer who will attend closing isn't your lawyer. He represents the lender. So do your due diligence and find a real estate attorney who can examine every document at length before you sign anything. You'll pay more, but legal representation is worth it.
#3: Invest in a Home Inspection
Unless you're an experienced contractor who knows houses inside and out, New Jersey On-Line says that a home inspection can protect you against buying a lemon. It can also give your some bargaining power in case defects are found that detract from the value of the home.
It's important to differentiate between an appraiser and an inspector. Appraisers work for the lender, and they assign a certain value to the property. They might find defects, but their primary goal is informing the lender of the home's fair market value. An inspector works for you. All defects are compiled in a report that's given to you, and his duty is to make you aware of the current condition of everything from the roof to the foundation, with minor exceptions such as security systems and other home add-ons that aren't critical for safe occupancy.
When you're in the market for a new house, the first thing on your mind is probably pulling up a real estate agent's website and scrolling through in the hopes of finding your dream home. But before you get too far ahead, protect yourself and make the process go more smoothly by taking care of some important business.
Pre-qualification, hiring an attorney and getting a home inspection once you've found a house are three of the smartest investments of time and money that you can make. The seller has representation once the house hits the market. It's up to you to protect yourself before you buy it.
At eppraisal, we help make buying a house a little less stressful on everyone. Check out our mortgage articles to learn more about what to expect when you're ready to buy.