When it comes to buying your first home it can be a bit overwhelming.
But it doesn’t have to be.
And depending on your realtor to “walk you through the process” can sometimes be a big mistake. At least it was for my wife and I just a few years ago.
Why is that?
Give me a few moments to explain…
First-time home buyer tips
Understandably the home-buying process can be stressful, especially when you find what seems to be your “dream house.”
Yet, as you probably already know, finding the right house is only half the battle. You still need to…
- make an offer
- pass inspections
- have your offer accepted
- move in
For my wife and I we took care of getting pre-qualified first.
That meant we knew what a bank or lender would give us (our upper limit) as well as what our monthly budget would look like once you factor in PMI, taxes, utilities, etc.
Next, we found a property and made an offer BEFORE getting an appraisal or having an inspection.
Here’s where our realtor really let us down.
Rather than suggesting we have an appraisal and inspection FIRST (thereby knowing possible issues with the home and it’s approximate value) we made an offer and then scheduled these steps AFTER our offer was accepted.
As it turns out we were now “under contract” and at the end of the day couldn’t get an approval for our mortgage because the agreed upon price was ABOVE market value.
The process dragged on for 6 months. The seller didn’t want to return our down payment, the mortgage broker referred to us by the realtor was incompetent and kept giving information to the seller’s attorney (someone he knew) which dragged the process out and kept running up our closing attorney’s fees.
By the time the deal finally fell through we were out more than $6,000 in attorney fees.
Needless to say, lesson learned!
We fired the realtor when my wife found another property online and she refused to show it to us because she claimed we couldn’t quality for the home (wrong). Using a mortgage broker I knew (who had pre-qualified us much earlier) we were able to schedule a property appraisal and THEN make an offer.
Less than 3 weeks later we were closing on our first home (much to the surprise of the realtor we fired).
So live an learn!
Here’s a quick first time home buyer checklist:
- get prequalified
- ask about special mortgage programs
- schedule your own appraisal
- get a home inspection
- have a radon test
- get your water tested
- get multiple homeowners insurance quotes
And here are a few other tips to keep in mind:
- trust your gut
- know your price range
- hire a realtor you’re comfortable working with (the third realtor finally worked for us)
- work with a mortgage broker rather than your bank
- hire your own property inspector
- get your own appraiser
Does that make sense to you?
In case you’re wondering the person I worked with to finance our home — and then refinance when rates fell saving me more than $350 each time — was Kim at Everest Equity. I’m not sure all the states she is licensed to work with. However, she’s a real pro and can answer ALL your questions (great for first time buyers) as well as finding you special mortgage programs if any are available in your area.
We used DP Appraisals to help determine the value of our home BEFORE we made an offer.
Finally, to schedule a home inspection in New York or Connecticut click the link for more information (for other states click the link above for the EPA website).
With more than 18 years of experience as a NY and CT home inspector, Compass Inspectors can give you the information you need to make an informed decision on your home purchase. They will always give you a custom report for your home, not a template or watered down information.
For more information and to schedule a home inspection, you can click the link to their website, or give them a call at 914-274-1579 today.
In case you’re wondering it all worked out great for my wife and I in the end.
We found a better home, in a better town and neighborhood for less than the first house we put an offer on.
But it still gets me a bit angry when I think about those 6 months of hell, not to mention the $6,000 in attorney fees for a “simple” closing…
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