Helpful Tips for Buyers
Before you shop:
Be a smart consumer.
Learn the financing basics. Know how to shop for a home loan that's right for you.
This takes very little time and lets you know the price range that fits your lifestyle.
Know what you want.
The last thing you need is to close a deal and realize you bought a house you don't want. Ask yourself what you're looking for in a home, before you shop. Think about size, commute time and necessary repairs.
Keep your debt load to a minimum.
Don't make major purchases or incur any additional debt until after your purchase. Pay down credit cards and don't apply for new ones. Remember, financial institutions evaluate your financial situation on your gross monthly income. Your total monthly house costs should not exceed 28 percent of your gross monthly income.
Be prepared to view new properties quickly.
Sometimes homes sell quickly, so be ready to make fast decisions. Be accessible to change the terms.
Have instant access to your agent.
Instant communication can mean the difference in purchasing the property of your choice.
Before you buy:
Submit a strong competitive offer.
Include a substantial earnest money deposit.
Sometimes offers are accepted based on the amount of the deposit.
Try to minimize the number of contingencies.
Fewer contingencies mean a stronger offer.
Hire an inspector.
A professional building inspector or appraiser will make sure the house of your choice is in satisfactory condition.
Check zoning regulations and covenants.
Good residential neighborhoods will be zoned to keep out commercial and industrial users. Read any restrictive covenants and make sure they fit your lifestyle.
Request an updated property survey.
Be sure it clearly marks boundaries. Check for problems.
Make sure you know what stays or goes.
Your contract should be very specific about which items (appliances, etc) are included in the sale.
Get agreements in writing.
Make certain verbal agreements are written into the final contract to avoid any stressful and expensive issues later.
Helpful Tips for Sellers
Make first impressions count.
Without a doubt, a visually curb appealing house will attract buyers, who can't help but respond to the look and "feel" of a home. Take time to carefully prepare for showings. Don't forget the following:
Cut the grass
Remove any clutter from the yard
Wash steps, windows, railings, doors, etc
Paint if needed
Scrub, dust and fix up the works.
Buyers will notice details. Get rid of the clutter, repair leaky faucets, wage war on dust and clean until your home shines. Small things can make a potential buyer walk away. When you prepare your house for showing, remember to:
Clean tubs, toilets and showers and hang fresh towels
Oil squeaky doors
Fix things like broken hinges and light switches
Remove unnecessary clutter from garages
Listen to suggestions.
As you prepare your home, don't rely solely on your own judgement. It's hard to be objective when you're the owner. Your realtor will have helpful, professional tips on how to make your home more marketable.
Take a whiff.
Nothing will turn a buyer away faster than an odd smell. Try to eliminate smoking, food, and pet odors. Don't leave any clues. If potential buyers see a dog or an ashtray, they'll be on the lookout for smells and stains.
Turn on the lights.
Open shades and draperies before a viewing. Open all doors inside the/your home. Turn on inside and outside lights.
Let potential buyers "see" themselves in your home.
Too many personal items can make viewers feel like they're intruding in someone else's home. Keep things clean and simple. Decorate in neutral colors.
Get out of the house.
When buyers view your home, they'll be more comfortable and spend more time if you're not there. If you must be present, be as unobtrusive as possible. Let your Realtor do the work.
Stay unemotional during negotiations.
Selling your home can be emotionally charged, but don't let that stand in the way of making a deal. Have a business-like attitude during the process.
Choosing a Real Estate Professional you like and trust is instrumental in home selling success!
Don't skip this step. Getting pre-approved is fast, easy and free. A written pre-approval includes a completed credit application and a certificate guaranteeing you a mortgage to a specified amount. With one in your pocket, you won't waste time looking at homes you can't afford. Instead, you can invest your time shopping for the home of your dreams - and in your price range.
Examine your finances.
How much can you afford to spend? While a lender will tell you how much you qualify for, it's up to you to figure how big a payment fits into your budget. What monthly dollar amount do you feel comfortable committing to? Remember to consider related costs such as insurance and taxes, as well as interest and principle.
Consider what type of loan is best for you.
Compare fixed-rate with adjustable rate mortgages. Look down the road. Where will you be in 15 years, 30 years? What obligations might you have? Take those things into consideration as you choose a loan.
Check your Credit Report.
A lender will run a credit report on you (it only takes a few minutes), but you'll be ahead of the game if you acquire a copy first. You'll know exactly what's on it and be able to correct any inaccuracies.
When you're ready to get a loan, explore your options. You can choose either a direct lender or a mortgage broker. A direct lender has money to lend and makes the final decision on your loan. Brokers are intermediaries who choose from many lenders. A broker may be able to help you find a loan if you have special financing needs, but he or she will also receive a percentage of what you borrow.
While you're shopping for a loan, also look for the best loan costs.
These may include:
- Interest rates
- Broker fees
- Points (each point is one percent of the amount you borrow)
- Prepayment penalties
- Loan term application fees
- Credit report fees
- Appraisal costs
Don't let hidden costs sneak up on you. Ask your lender for a written estimate.
Apply for a loan.
Gather all the documents you'll need to verify your loan application. Lenders will want to know your job tenure, employment stability, income, assets (property, cars, bank accounts and investments) and your liabilities (auto loans, mortgages, installment loans, credit-card debt, household expenses and others). You'll need to provide documents such as paycheck stubs, bank account statements and tax returns. Check with your lender or broker for more information.
Lock it down.
With interest rates changing daily, locking down your rate can prove a big money saver. A rate lock - in writing - guarantees you a certain rate and terms for a specified period of time. Lock in all the costs you can, including interest rates and points. And try to set the lock at the time of application, not at approval. This will protect you from rising rates. Your lock-in period should be long enough to allow for all processing time. Most lock periods range from 15 to 60 days. Make sure to check with your lender or broker about the average time it takes them to process a loan.
Ask about Pre-payment.
You can shave years off the length of your mortgage by restructuring the way you pay back your loan. Simply paying more frequently can save thousands in interest. So can making a lump payment toward the principle - or paying a little more each month. These methods are called pre-payment. Not all loans allow for pre-payment. If you want the option, discuss it with your lender or broker.
Clear up any financial problems.
Do you have credit problems or owe money to the IRS? Buying a new home may still be a possiblity. Contact a financial advisor or tax resolution service to find solutions.