Is homeownership in my immediate future?
Being a homeowner undoubtedly comes with its own set of challenges, but the benefits can certainly outweigh those demands. Homeownership can also surpass the benefits of renting, but everyone’s situation is unique. It’s very important to consult your REALTOR® when asking if homeownership is right for you.
If you are thinking about buying a home, it’s vital to look at your situation in life. What’s your financial situation as it pertains to your debts, assets and your current lifestyle? Do you pay all your bills on time? What does your credit score look like? Are you reliably employed? Do you have money saved for a down payment on a home?
How much home can I afford?
Before you begin looking for homes, we highly recommend that you contact your lender for a pre-approval. Your lender should also provide for you a good faith estimate (GFE). The GFE will give you a fairly good idea of what you can and cannot afford, based upon your current circumstances. A mortgage pre-approval will make you more attractive to homesellers and show them you’re serious about buying their home.
Prior to contacting mortgage lenders, you can utilize our mortgage calculator.
Is it better to rent or buy?
Much ink has been spilled on this question over the years. While we certainly don’t want to oversimplify this response, it’s important to realize that many factors should go into making the right decision for you. We would suggest beginning with a pros and cons list for renting versus buying. Again, it’s very important to consult your REALTOR® when asking if homeownership is right for you.
Generally-speaking, renting gives the occupant the freedom from maintenance and home repair costs, no real estate taxes, flexibility to downsize or leave at the end of your lease, cheaper access to amenities, lower insurance costs, etc. Purchasing a home enables you to build equity, take advantage of tax benefits, in most cases – have fixed mortgage payments over a fluctuating lease (as rents increase) and allows the homeowner to do anything to their property (so long as there isn’t a homeowners association nor township/municipal ordinances with existing restrictions).
What’s a buyer’s representative and should I get one?
A buyer’s agent or buyer’s representative is an agent who’s an advocate for the homebuyer in a real estate transaction. A buyer’s agent owes fiduciary responsibility to his/her buyer-client, which includes confidentiality and loyalty. He/she must always protect his/her client’s best interests throughout the duration of the representation.
Without a business relationship with a buyer’s agent, you – as the buyer – are not being represented nor are your interests being protected. Thus, if you’re actively seeking a home to purchase, it’s critical that you hire the services of buyer’s agent.
When you have an agency relationship with a buyer’s rep, the agent should provide the following:
- Assistance with assessing the buyer’s needs
- Directing the buyer to sources of financing and other professional services, if applicable
- Directing the buyer to the source for information pertaining to school districts, neighborhoods, demographics and the like
- Scheduling showings for the buyer
- Helping the buyer to prioritize which properties and criteria in the home search process are a good fit
- Explaining contracts, while helping the buyer to anticipate next steps
- Proposing contract contingencies to protect the buyer
- Negotiating on behalf of the buyer
- Protecting all confidential information of the buyer
- Overseeing the entire process, from beginning to end, assisting the buyer with any issues that might arise
What are the costs to hire a buyer’s agent to represent my best interests?
In almost all cases, the answer is nothing or little to nothing. Usually, when a home is listed for sale, the seller’s contract specifies the commission being offered to the buyer’s agency. This generally covers all or most of your representative’s compensation.
When I start shopping, what should I be looking for in a home?
This question is unique to each and every seller, but you should begin to make a list of what you need and what you can live without in your search. For instance, how much space do you need? How many bedrooms would be required for you and your family, both now and in the future?
As a buyer, you’ll want to be concerned about resale value. Does the home you are thinking about buying have characteristics that will most likely also be desirable to homebuyers years from now, if you need to sell. What issues or potential ones do you see? What’s the neighborhood like? What’s the school district like? Your REALTOR® can guide you in answering those questions or lead you to a home inspector or someone who has the answers.
Should I get that home inspected?
You’re not only buying the home you fell in love with, but also you’re purchasing any problems that come with it. All those things you can’t see or didn’t think about or didn’t even know existed can come back to haunt you, if you fail to take the proper steps in hiring a home inspector. Yes, there are occasions where a homebuyer finds themselves in a bidding war, where waiving a home inspection may be an incentive for the seller to take your offer over the others, but those cases are rare (and, if doing so, proceed with caution). A home inspection will bring awareness to any trouble areas, especially material defects in the home that will need to be addressed (if you’re proceeding with the sale).
What if I change my mind about my home purchase?
If a buyer is experiencing remorse about his/her purchase, chances are he/she would be forfeiting his/her earnest money deposit (the escrow monies put down to secure the offer). If there is a good reason to back out of the deal, such as an unsatisfactory home inspection or a property not appraising for the purchase price, then the buyer is free to walk away from the transaction and have his/her escrow deposit returned.