5 Secrets to Buying the Best House
for Your Money”
When you're buying home, there are many important
issues, large and small, that you should be aware
of to maximize your buying strength.
It is essential to be as informed as possible in
order to properly prepare yourself in the process
of buying a home. There are several issues that will
certainly cost you if you are not ready. In this report,
we identify 5 of the most common of these issues.
Because there are many issues to consider,
your first step is to consider choosing reputable
and experienced professionals to represent your interests.
When selecting your real estate agent, ensure you
find someone who has extensive experience with the
process. They should also refer you to a local real
estate lawyer who can ensure your interests are protected.
Here are the secrets to maximizing
your buying power…
Do you want to get the best property you can for
the least amount of money? Then make sure you are
in the strongest negotiating position possible. Price
is only one element in the negotiations, and not necessarily
the most important one. Often other terms, such as
the strength of the buyer or the length of escrow,
are critical to a seller.
In years past, I always recommended that buyers get
"pre-qualified" by a lender. This means
that you spend a few minutes on the phone with a lender
who asks you a few questions. Based on the answers,
the lender pronounces you "pre-qualified"
and issues a certificate that you can show to a seller.
Sellers are aware that such certificates are WORTHLESS,
and here's why! None of the information has been verified!
Many times unknown problems can come to the surface!
Some of the problems I've seen include recorded judgments,
alimony payments due, glitches on the credit report
due to any number of reasons both accurately and inaccurately,
down payments that have not been in the clients' bank
account long enough, etc.
So the way to make the strongest offer today is to
get "pre-approved". This happens AFTER all
information has been checked and verified. You are
actually APPROVED for the loan and the only loose
end is the appraisal on the property. This process
takes anywhere from a few days to a few weeks depending
on your situation. It's VERY POWERFUL and a weapon
I recommend all my clients have in their negotiating
arsenal.
If you have a house to sell, sell it before selecting
a house to buy! Contingency sales aren't nearly as
strong as one that comes in with a ready, willing
and able buyer.
Consider this scenario: You've found the perfect
house - now you have to go make an offer to the seller.
You want the seller to reduce the price and wait until
you sell your house. The seller figures that this
is a risky deal, since he might pass up a buyer who
DOESN'T have to sell a house while he's waiting for
you. So he says OK, he'll do the contingency but it
has to be a full price offer! You have now paid more
for the house than you could have because of the contingency,
and you have to sell your existing house in a hurry!
Otherwise you lose the house!
So to sell quickly you might take an offer that's
lower than if you had more time. The bottom line is
that buying before selling might cost you THOUSANDS
of dollars.
If you're concerned that there is not a house on
the market for you, then go on a window-shopping trip.
You can identify possible houses and locations without
falling in love with a specific house. If you feel
confident after that then put your house on the market.
Another tactic is to make the sale "subject
to seller finding suitable housing". Adding this
phrase to the listing means that WHEN YOU DO FIND
A BUYER, you will have some time to find the new place.
If you don't find anything to your liking, you don't
have to sell your present home.
Before house hunting, make a list of things you want
in the new place. Then make a list of the things you
don't want. You can use this list as a guide to rate
each property that you see. The one with the biggest
score wins! This helps avoid confusion and keeps things
in perspective when you're comparing dozens of homes.
When house hunting, keep in mind the difference between
"STYLE AND SUBSTANCE". The SUBSTANCE is
something that cannot be changed such as the location,
view, size of lot, noise in the area, school district,
and floor plan. The STYLE represents easily changed
surface finishes like carpet, wallpaper, color, and
window coverings. Buy the house with good SUBSTANCE,
because the STYLE can always be changed to match your
tastes. I always recommend that you imagine each house
as if it were vacant.
Consider each house on its underlying merits, not
the seller's decorating skills.
Your agent should show you everything available that
meets your requirements. Don't make a decision on
a house until you feel that you've seen enough to
pick the best one.
A decade ago, homes were selling quickly, usually
a few days after listing. In that kind of market,
agents advised their clients to make an offer ON THE
SPOT if they liked the house. That was good advice
at the time. Today there isn't always this urgency,
unless a home is drastically under priced, and you'll
know if it is.
Don't forget to check into the SCHOOL DISTRICTS of
the area you're considering. Information is available
on every school; such as class sizes, % of students
that go on to college, SAT scores, etc. You can get
this information from this web site.
Please note - ads are sometimes created to make the
phone ring! Many of the homes have some drawback that's
not mentioned in the ad, such as traffic noise, power
lines, or litigation in the community. What's not
mentioned in the ad is usually more important than
what is.
For this reason, I want you to be very
careful when reading ads. Remember that the person
writing the ad is representing the seller and not
you! The most important thing you can do is have someone
on your side looking out for your best interests.
Your own agent will critique the property with an
eye towards how well it meets your needs and will
point out any drawbacks you should know about.
So whether you decide to work with me or not, pick
an agent you feel comfortable with and enlist the
services of that agent as a buyer's broker. Then you
become a client with all the rights, benefits, and
privileges created by this agency relationship, and
you're no longer just a shopper.
Did you know that many homes are sold
WITHOUT A SIGN ever going up or an AD EVER BEING PUT
IN THE PAPER? These "great deals" go to
those people who are committed to working with one
agent. When an agent hears of a great buy, whom do
you think he's going to call? His client, who he has
a legal obligation to work hard for you, or someone
who just called on the phone and said "keep your
eyes open"? So to get the best buy on a property,
I always recommend that you hire your own agent and
stick with him.
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