Making an offer? Recently, we came across an article from Vogue Magazine underlining areas where buyers should concentrate their efforts prior to purchasing a home. In my experience, many take these lightly while pursuing a home purchase. Spend some time considering how the following will save you grief through the real estate process.
The 28% Rule
I wish I knew about this rule when I was seeking preapproval for purchasing my first home. At the time, my wife and I’s credit scores coupled with our income painted a false picture of a mortgage payment beyond our reach and definitely left us out of our comfort zone. So be cautious here. What’s this 28% rule? Simply put, it states that you should cap your monthly housing payment at 28% of your pretax income.
The Haves & The Have Nots
No, I’m not referring to Tyler Perry’s show on OWN TV. I have yet to watch the program either, so I can’t really comment on it, but what I can comment on is the article’s suggestion for creating a list of what you don’t want in the property. The ‘have nots’ can be likened to a chisel, beginning to chip away from the confusion which is your ideal home. This is a great strategy for discovering your ‘almost-perfect’ home and cross-referencing it with listings currently on the market for sale.
Become A Private Investigator
The most prepared home buyers grab the reigns and attempt to uncover as much information on the property, its location, its condition and the like, prior to making an offer. If this means parking your car outside the listing, rolling down the windows and reading a good book (might as well be efficient with your time), then that’s what it takes. This would certainly give you a better idea of what the neighborhood is like. Of course, your real estate professional can assist you greatly in this area of discovery. Have questions about the sellers? Ask your REALTOR®. Any defects to the property? Have your REALTOR® dig into the property disclosure statement.
Is It Even Possible?
Unfortunately, some buyers have grand notions about how to remodel a home without having the proper professionals being involved in steps along the way, prior to the real estate purchase. Will the township/municipality even allow an addition whether it is a deck or additional living space? Can I knock out that wall? Is it load-baring? These are critical questions to find the proper answers to before making this huge investment.
Put Your Buyer’s Agent To Work
Piggybacking on the heels of what we already touched on, the article from Vogue likewise emphasizes the importance of your real estate agent’s involvement. Not only should he/she be included through the process, but the agent should also be front and center when any offer is presented to a seller. This includes providing a comparable market analysis (CMA) to the buyer to verify a home’s fair market value in addition to negotiating the price, terms and conditions of a deal on the buyer’s behalf with the listing agent and seller. As a prospective home buyer, you need to put your REALTOR® to work – it will only benefit you more in the end.
Those five items are important to the process for buyers in today’s real estate market. Did we miss anything? Please share your thoughts with us.
To read the full Vogue article, click here.