All real estate agents work by an ethical rule that says they must act in the best interests of both the home seller and the home buyer. However, you cannot truly guarantee that your best interests are involved unless you have an agent on your side during the buying process. After all, the seller’s agent is there to represent the seller, not the buyer.
Finding the perfect house may seem easy, but if you’re on a budget, you may not be able to afford that dream home. So, why not find a lower-quality home and, over the years, help it reach its true potential? Finding a house you can add value to allows you move up the property ladder.
Improving a lower-quality home brings many benefits. First, you most likely have the option to sell it for more than you spent on it. Secondly, you have saved money to live in a home that, once upgraded, is just as good as or better than the expensive homes. And finally, you have something to be proud of – you transformed a decent home into a wonderful home through your own work or work for which you were responsible.
Although you shouldn’t let cosmetic, surface imperfections steer you away from a home, you shouldn’t ignore large problems that could cost you big time down the road. Always be sure to inspect the home and understand what shape the house is in before closing on a sale.
Once you’ve fallen in love with a house, It can be easy to write off large problems as petty. However, try to keep your emotions and feelings in check during inspection. If you let your emotions get the best of you during inspection, you may regret it when a major problem occurs down the road and you may end up paying more while getting less.
Remember: it’s easier to make small changes through a contractor or by doing it yourself than it is to have the current home owner change things. If you find a home that’s perfect for you except for some ugly wallpaper or chipped paint, don’t automatically throw it out the window. It’s much cheaper to make changes yourself, whether that means hiring a contractor or actually making home repairs yourself.
If the current home owner does the upgrades for you, the home’s value increases and you will end up paying more in the long run. Therefore, don’t necessarily look for the most beautiful home, but rather seek the home that’s structurally sound and that has the most potential. Maintaining a visionary’s attitude when buying a home can save you a lot of money in the long run.
While it’s important to have an open mind while searching for a house, it’s also important to know what you absolutely need and what you could give up.
For instance, if you know you want to have a child in a couple years, avoid buying a one-room home. If having a child is something you value, make sure you have room in your new house for your family to grow. No matter what your values, determine what’s most important to figure out what you can and cannot compromise.
While you should narrow down what you want and you list features most important to you, don’t be so inflexible that you make it impossible to find a home. If you’re too picky, you may have to continue renting when you could own a home. Be willing to compromise on some of the less important things that can be changed or ameliorated later, like outdated décor.
However, it’s vital to remember what’s most important to you. If you really can’t find something that has what you need and want, it may be best to rent for a few more years until something new comes along or until you’ve saved up more money to afford your perfect home.
Even if you can afford the cost of a home, remember owning a house requires additional expenses a renter doesn’t have to pay. For example, homeowners have to pay for insurance against disasters, for home repairs and improvements and for property taxes. In addition, condominium owners are required to pay maintenance fees as part of the homeowner’s association. Be sure to make yourself away of the additional expenses of owning a home so you don’t find yourself in trouble after purchasing.
Before you place an offer on a house, obtain a pre-approved loan. This way, you won’t agree to something before knowing you will be able to pay for it. Also, understand that even after you’ve been pre-approved, the loan can still fall through if you do something to dramatically alter your credit score, like buying a car.
Therefore, when buying a house, it’s important to not only receive a pre-approved loan, but to also hold off on other large expenses for a while. If you really can’t wait to get that new car, perhaps you should hold the home purchasing process until later. After all, only you can determine what’s most important for yourself and your family.
Budgeting isn’t easy, but the fact is, if home buyers don’t set a budget for what they can afford for a house, things can go terribly wrong. The recent subprime mortgage crisis is a perfect example. Banks may say home-buying hopefuls can afford an amount they actually cannot afford. Budgeting is one way to ensure you don’t get trapped by knowing what you can and cannot afford to remain financially comfortable.
Create a budget that includes your major expenses. Examples of major expenses could be student loan payments, transportation costs (gas, car payments, etc.), credit card bills, cable bills and telephone bills. Also be sure to include expenses that come only once a year, like holiday bills or taxes. Add all this together and subtract it from what your earnings — the result is what you can afford on a house.Home buyers who skip this step could end up either badly wanting something they can’t afford and/or putting themselves at risk financially.