The Dos and Don’ts of Home Buying
Buying a home is easy, right? Just pick a house and buy it! Ideally, buying a home would be as simple as buying groceries. But at Marx-Bensdorf, after more than 150 years in real estate, we can tell you that it’s not as simple as 1-2-3. However, there are a couple of things you can do to help keep yourself on track, as well as some we recommend avoiding.
The Dos
Work With A Licensed, Experienced REALTOR
A good REALTOR who is seasoned in both the profession and the market can be of great benefit to their client. That’s why having an experienced agent is so important. Always choose someone you feel understands your needs and is going to work the hardest for you. REALTORS have many clients, but having an agent that makes you feel heard and important is key to a successful relationship.
Marx-Bensdorf has been serving the greater Memphis area for over 150 years. We love what we do, and we’re dedicated to exceeding the expectations of our clients. With more than 45 REALTORS, our combined expertise makes us one of the most knowledgeable and connected firms in Memphis.
Get Preapproved
Like any purchase, you need to know how much you can spend and how you are going to pay for your home. We can’t stress this enough! Getting pre-approved is imperative because it gives not only you but the seller and listing agent the confidence you are a valid candidate to purchase the property. Many sellers won’t even consider entering into a contract with a buyer who isn’t preapproved. Not only will it help you during the buying process, but getting preapproved will also help you figure out just how much house you can afford. You may want to buy less house than you can afford, but you want to know the bank will back you if you do.
Know What To Expect
When taking on any new endeavor, it’s important to do your due diligence. Buying a home is a lengthy and oftentimes confusing experience. Knowing the typical flow of the process will not only remove some of the stress and uncertainty but will also let you focus on unexpected issues that may arise
READ MORE: How To Buy A Home →
Consider The Resale Value
This is a trap that first-time homebuyers often fall into. They find a newly remodeled home, complete with recessed lighting, new kitchen appliances, brand new floors, and a lovely coat of paint on the outside. Who could ask for more?
It’s important to check the property values of the homes around the one in which you’re interested. If your dream house is the most expensive property in the area, that might mean you’re going to have difficulty selling it later for a price you deem appropriate. It doesn’t necessarily mean that the neighborhood isn’t good, just that the seller has put a significant amount of money into the property regardless of the location.
On the flip side, a house that’s less expensive than many of the houses surrounding it may need some serious work, but it can also mean you’ll pocket a significant amount of cash if and when you decide to sell.
Understand the Lingo
What are closing costs? What is escrow? These are good questions! Knowing some real estate terms can help when buying a house. Your real estate agent is there to educate, guide, and to answer questions. Doing some research ahead of time will help you to communicate with your agent and others as effectively as possible throughout the process.
SEE MORE: Common Real Estate Terms →
The Dont’s
Don’t Let Your Emotions Pick Your Home
There is absolutely no doubt that buying a home is an emotional process. It’s important for a house to feel right just as much as it should have the features you want. After all, it’s going to be your home! But sometimes our emotions can get in the way of good sense. You may find a home that you think is just perfect. It’s everything you want. You can see yourself hosting parties and raising a family and growing old there! You could probably stretch your budget a little further, right?
Don’t do it! There’s no point in buying a home if you can’t afford the utilities or the furniture to go in it. There’s no benefit to damaging yourself financially for a swimming pool. Try and approach home buying as rationally as possible. We’re not saying you shouldn’t get excited, but keep your expectations realistic and you may discover that you and your agent find another home you love even more.
Don’t Shop for a House Before you Shop for a Mortgage
Daydreaming and looking at properties is a great way to whet your home-buying appetite, but don’t go in blind. Until you’ve gone through some preliminary steps (selecting a REALTOR, a lender, and getting preapproved), we recommend waiting to go and look at a property. As we mentioned, many sellers won’t even work with buyers who aren’t preapproved because it doesn’t have the appearance that they’re serious about putting in an offer. So don’t put the cart before the horse, and you’re less likely to be disappointed.
Don’t Buy a House Just Because It’s In Your Budget
Because a home is in your budget, it doesn’t mean it’s the one. Sometimes you walk into a beautifully staged home and know it’s the one you want to buy, and that’s great! But you’d be remiss if you didn’t at least take a look at other properties. If anything, this will show you your options.
Don’t take the Seller’s Word For It
We really can’t stress enough the importance of a professional home inspection after you are under contract. . A listing is designed to “Wow” you. Remember, paint and furniture can hide or distract you from seeing underlying problems. Presumably, you’re going to be in your house for a long time, and certain repairs can be very costly, particularly for first-time buyers.
Don’t Change Jobs or Buy A Car
This tip is less obvious, especially for individuals who haven’t tried to obtain a loan When your finances are being closely examined by your lender, it’s critical that you don’t do anything that changes your financial profile. Don’t Make Any Major Credit Card Purchases
This tip comes on the heels of our last “don’t.” Just as you don’t want to do something that will shift your income, you also don’t want to do anything that will significantly change your debt-to-income ratio. Buying that perfect sofa on sale the week before you close is very tempting. However, any sudden change in credit may stop your home-buying process.