My Real Estate Blog

April 8th, 2010 8:15 AM
Here's a list of things that, in my opinion, buyers should NOT do when looking for a home:

1) Don't start looking until you've talked with a mortgage LENDER.  Being pre-qualified gives you a general idea of how much you can afford to borrow. It's better to be pre-approved for a given loan. Sellers will take you more seriously. You'll stay on budget. At least in the Metro DC area, buyers (per the contract) are able to substitute financing as many times as they'd like after ratifying a contract as long as it doesn't change the settlement date and doesn't cost the seller anything.

2) Don't do it alone!  Buying a house is a complex transaction. It should be a team effort. You'll need a real estate agent, lender, home inspector,and an insurer, to help you through each step of the way. Team build before you start the search.

3) Don't fly blind!  You are engaged in what's likely your most valuable acquisition ever. It's a business transaction. Ask family, friends, co-workers, professionals and others you trust for referrals, but don't take their word for it. Talk to a couple of different agent before you decide who you want to work with.  You're going to be spending a lot of time with this person.  You have to like being around each other! 

4) When house hunting, don't believe in 'Love at First Sight'. You won't live happily ever after if you let your emotions carry you through the home buying process. Your home should fit your real needs, not your yen for drama. Buy a home that fits your budget and your lifestyle. Be sure the home is in a community and neighborhood you desire. Visit neighborhoods several times before you buy to check out schools, noise and traffic patterns. I always tell buyers to sleep on it one night before taking the plunge.

5) Don't overspend.  Lenders usually qualify buyers for more than then need.  Don't let those numbers fool you.  The important numbers are the one that are going to be on your mortgage statement each month!  Analyze all your monthly costs including debts, food, transportation, entertainment, and savings. Rule of thumb, your total monthly debts, including your mortgage, should not exceed 36 percent of your income before taxes.

Tomorrow, my other five suggestions.  Take a look at my FaceBook Fan Page: Real Estate Real Simple.  

Posted by Jim McCowan on April 8th, 2010 8:15 AMPost a Comment (0)

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