As a mother, I try to prepare my children to the best of my ability. We talk about what to expect on the first day of school, how to make good decisions, the importance of problem solving, and so much more. There’s a line between teaching our children and doing for our children.
Can anyone be over prepared for the process of home buying? No, you can never be too prepared for the home buying process. As a buyer’s agent, this is where I believe a big portion of my value comes from. I want my buyers to know what to expect, understand the process, and be prepared for the unexpected, because there is ALWAYS the unexpected.
In an effort to share some of the most valuable lessons learned about purchasing home, I created my The Top Eight Things Momma Never Told Me About Buying a House.
1) Find a realtor you trust
Before you start browsing Realtor.com and searching Zillow.com, find a local agent you trust. Do not just hire the agent listed on the sign in front of a house you want to see. Before settling on an agent, meet a few realtors for coffee. Find one that understands and supports your goals. Are you trying to find a house quickly? Do you need a realtor that’s patient? Are you relocating to an area you don’t know well? Consider your situation and needs and find a realtor who will help you.
Start with a personal referral. Ask your friends who their agent was and how things went working with them. If you no one can refer an agent to you, ask the agents you interview for a couple references.
Make sure the agent communicates how you like to communicate. Are you a texter? Do you prefer phone calls? Would email be best?
Buying a home can be emotional and stressful. Make sure you feel comfortable with the agent to give you advice you can trust.
2) A good mortgage broker is worth their weight in gold
Whether you find a realtor first or a mortgage broker first, either way, both are vitally important and should be top priorities. If you choose a realtor first, odds are, they’ll know a good mortgage broker that they already work with.
Using a mortgage broker instead of a bank gives you more variety and versatility. Instead of the few options a bank will give you, a mortgage broker has access to a large variety of loans and lenders, and in my experience, work hard to get buyers approved for the best loan in the shortest time.
Additionally, mortgage brokers are adaptive. They can switch course if needed. For example, I had a couple looking at single family homes. The mortgage broker initially pre-approved them for an FHA loan, but when they found a fixer-upper, the broker was able to quickly change course to secure an FHA renovation loan.
3) You will need cash during the process
There are a few expenses to budget for during the home buying process. They aren’t necessarily expensive, but they are important.
First, you will most likely be required to put a deposit in escrow. This is typically 1-2% of the price of the home. For example, if you put a contract on a home for $200,000, the contract will specify that you need to deposit $3,000 in an escrow account at the assigned title company.
Second, you will be granted an inspection period. During this finite timeframe, it is your responsibility to pay for any inspections you want of the property. This can include, but is not limited to, a home inspection, WDO inspection, pool inspection, septic inspection, HVAC inspection, etc. On average, these run from $200-400/each.
Lastly, you will need cash to move. Whether you pay a moving company to do it all or you only rent a truck, save some money for moving expenses. Besides the actually cost of moving your things, you many need funds to clean or make repairs to your old place or pay deposits on utility services.
4) Don’t focus on the superficial
This can be hard when you think about how much money you’re spending on a home, but refrain from focusing on the superficial. It’s easy to notice the dust covered fans, stains, the ugly paint, and so on. Look for the potential not the problems. Remember: basically, everything can be changed or fixed to meet your preferences. Don’t let the small stuff get in the way of snagging a good house.
When showing a house, one of the roles I find myself fulfilling is the potential police. I inherently see the potential in houses. I can visualize what a fresh coat of paint and new floor will bring to a home, or how knocking down a wall will change the entire living space.
5) Don’t fall in love
House love is a fickle beast who will break your heart. Try to keep your heart at bay and lead with your head. It’s important to remember until after the inspection period and your final contract is in place, you may not land the home you’re heart is set on for a variety of reasons. For example, a seller may not accept your offer or the inspections may show very costly repairs that the homeowner won’t fix nor will they come down in price.
6) It’s okay to change your mind
Almost everyone goes into house shopping with a list of criteria they need to have, but as you look at homes and see what’s out there, your criteria may shift slightly. Furthermore, you may start to realize some criteria are more important than others, and you’re willing to sacrifice a pool for a fourth bedroom or a remodeled kitchen. Additionally, as your realtor gets to know you, she may expand your search criteria a little. Allow your realtor to expand it and trust her opinion and instincts. You hired your buyer’s agent for their skills and expertise, trust in that.
7) Your home inspections WILL find issues
“You pay inspectors to be negative; you pay contractors to be positive,” I’ve given most of my buyers this guidance.
Home inspections are meant to find everything wrong with a home. Honestly, it is very overwhelming to see a document listing the home’s issues, but I return to the importance of seeing the potential not the superficial problems.
Here, it’s crucial to differentiate between big problems and little issues.
- Cracked foundation or structural weakness
- Significant water damage
- Needs a new roof
- Septic system needs replaced
- Faulty electrical system
- Heating/cooling system defects
- Significant plumbing issues
- Poor drainage
- Termite infestation
- Cracked pool
- Outlets needs replaced
- Holes in wall or peeling paint
- Filters need replaced
- Cracked tiles
- Clogged drains
- Broken glass
- Old appliances
- Missing kick plates
- Damaged or stained countertops
- Open permits
8) Expect the unexpected
Generally, home buying is not a smooth process. It can be, but it usually isn’t. This is yet another reason to have a good agent. A good realtor will help keep you calm, stay in the know and provide needed guidance.
There will be hiccups along the way. From start to finish, expect delays, changes, and worse. Your offer may not get accepted, the seller may not agree to pay closing costs, the seller’s realtor may be difficult to reach, the home inspection will find issues, the seller may not renegotiate, the contract may be cancelled, your loan or lender may change, the appraisal may not come back at what was anticipated, necessary permits may be missing, the closing date may be pushed back, and the list goes on and on.
I give this list not to deter you but to prepare you. You should not experience all of these. I hope you don’t experience any of them, but if you do, it is important to be prepared and have someone in your corner. Everything is not as you see on TV, but home-ownership can be a very rewarding journey.