| 1. |
Before starting your
search for that perfect house, take time to discuss what you're looking for
with your spouse or partner. Make a list of "must have" features, and also "would like, but can live without" features. After you've looked at a dozen or so properties, re-evaluate your
criteria. Often priorities shift with time.
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| 2. |
Before you start looking
have a realistic idea of how much you can afford (most lenders will pre-qualify
you for free). This important information will save you time, but also will
avoid needless disappointment later if you find the perfect house you cannot
afford.
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| 3. |
Don't sign a contract
with an agent that locks you into looking with him/her, or guarantees them a
commission even if you find the house yourself! Specify, instead, that a
commission will be paid only if you buy a property shown to you by that agent.
This enables you to look with others, and also at For-Sale-By-Owner properties,
at your own convenience. Remember buying a house from a FSBO can save you
thousands of dollars. Remember when you hire an agent to list your house you
have to inflate the price to pay their high commission. Buyers can save a
bundle purchasing from a FSBO.
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| 4. |
If you do have an agent
don't bring him/her with you to look at FSBO properties, or bring them into the
picture when it's time to draw up a contract, unless you are willing to pay
their commission through either a higher sales price, or out of your own
pocket. Otherwise, you may risk losing the house. (note: your lawyer and banker
can help you if you aren't sure of the process. Don't tell your agent you are
looking at FSBO's, plus never give them the address of the FSBO you are
planning to view, otherwise they will invariably meet you their. Once they are
at the house, they expect their commission, even though they did nothing to
earn it or find the house for you. You MUST be careful when dealing with an
agent.
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| 5. |
If you find the house you
want to buy before you've sold your home, and the seller is reluctant to sign a
contract with you with the contingency that you sell your home first, you may
draw up a contract that allows the seller to continue marketing and advertising
the property yet gives you the "first right of refusal" should
they receive another offer. This way you will be notified immediately if the
seller has another offer, giving you an opportunity to re-offer if necessary.
Another option is to put a non-refundable deposit on the property. This shows
the sellers that you are serious about buying their property.
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| 6. |
If you sell your house
before finding a new home, make sure you specify a certain amount of time given
to you before moving out. You can make the sales contract contingent upon you,
the seller, finding suitable housing - this sounds good, but often the buyer is
anxious to move into the house and he himself can't give you all the time you
need to look for suitable housing, this clause can cost you the sale of the
house! We have heard stories of people frantic to find a home under pressure,
and even having to rent after the closing, because they sold first. Remember,
the seller is legally bound to sell once the contract is signed.
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| 7. |
When presenting an offer,
be courteous and respectful of the seller. In general, avoid criticizing the
property with statements like "we don't about the extras or the color of
the new carpeting, and therefore will have to replace it." This will not
justify a lower offer and may possibly insult the sellers, decreasing you
chances of their accepting your offer. Always remain on friendly terms with the
sellers while negotiating, it makes the buying process more enjoyable.
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| 8. |
If you think the property
may be overpriced, yet the seller refuses to take a lower offer -- make your
offer contingent upon the property appraising for the selling price or
higher.
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| 9. |
Request a walk-through
inspection of the house shortly before closing. It's great if the seller has
moved out and the house is empty this way you can spot faults that were covered
up with furniture, wall coverings, etc. It is far easier to request
compensation for necessary repair work before the house is sold than
afterwards.
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| 10. |
Request that the seller
complete a property disclosure form, stating the condition of all aspects of
the property, before you make an offer. (If the seller doesn't have a form, you
can purchase one at a bookstore or get one off the Internet, or I can supply
you with one at your request - for a small S&H fee, just send an e-mail).
The seller is legally bound to be truthful in reporting the property's
condition.
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| 11. |
Make the time frame of
your offer short (24-48/hours) so the seller has less time to "shop the
bid" among other interested parties, or to accept another offer. Also,
make the deadline time between 6-8p.m., so you have time left in the evening to
counter-offer if necessary! Many deadline times are at midnight which makes no
sense at all. Most people are asleep by midnight and don't feel like
negotiating contracts.
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| 12. |
Put everything in
writing. Your sales contract should spell out whether the appliances
(washer, dryer, stove, refrigerator, etc.) stay. If everything is in writing,
you will have no surprises and enjoy the home purchasing experience.
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| 13. |
Buying
directly from the homeowner (FSBO) transaction will SAVE YOU MONEY - the cost of having to pay for the
real estate commission. The 6-7% commission charged by the agent will often
times be added to the total cost of the home. When this is done, the buyer will
end up paying the commission. Buying a home in a "For Sale
By-Owner" transaction will cost you less money and you'll get more
home for your Money.
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| 14. |
When you
deal directly with the homeowner rather than through a third party you will SAVE TIME. Communications is more direct,
faster and to the point with only buyer and seller involved. You will get more
accomplished in a shorter length of time which means you can move into your new
home sooner!
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| 15. |
Some people
think purchasing real estate from a FSBO is difficult. This myth is far from
the truth. Purchasing "For Sale By-Owner" is EASY TO DO! Once you and the homeowner agree upon
the price and your forms are filled out, turn everything over to a Title
Company and they will take care of the rest. This is the same thing that
happens when you use a real estate agent, except there are no commissions to
pay. Your Mortgage Broker can usually suggest a good Title Company. |
