Home Buying Tips and Help for Home Buyers
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They're a couple in their early 30s -- a computer technician married to a bank teller. They have stable jobs, a down payment in the bank and an intense desire to escape their Charlotte condo for a luxury home in Raleigh North Carolina.
In fact, the couple has picked out their ideal property -- a sprawling ranch-style house on a full acre. Plus they're convinced this is an opportune time to buy.
Still, the couple is racked with doubts and have yet to make a serious bid on the property. Are they crazy to consider buying in so tumultuous a real estate market? Their parents think so and call them often to urge that they hold off.
This couple's situation illustrates the pervasive confusion affecting prospective homebuyers at a time of economic uncertainty, says a real estate broker, who is also the author of "A Survival Guide to Buying a Home."
One manifestation of buyer ambivalence is a common phenomenon: the withdrawn bid.
"People search around and around for the perfect house at a bargain price. When they find it, they're super excited and run to their agent's office to write an offer. But an hour later they tell the agent to tear up their bid," the broker says.
Of course, buyer ambivalence is understandable -- given the economic situation in the country. Turbulence on Wall Street, along with high gas and food prices and job jitters are combining to cause insomnia for many once-confident members of the middle class.
"It's difficult to get a handle on home values now -- or to accurately project what real estate will be worth in the future," the real estate broker says. Even so, he insists that those who get a rock-bottom price on a home in a desirable community will one day be glad they acted now rather than waiting.
Here are pointers for those now contemplating a home purchase:
• Clarify your reasons for making a purchase.
Fear is a powerful force that can restrain people from going forward -- even when they believe it's in their interest to do so. But those convinced that now is a good time to realize a long-held housing dream shouldn't let ungrounded fears inhibit them, says another real estate broker and former president of the National Association of Exclusive Buyer Agents.
"The main thing is to go into a purchase with your eyes wide open, plus every piece of solid information you can obtain," the other broker says.
Keep in mind, though, that there could be reasons why it might be imprudent for you to buy now, including near-term employment prospects or perceived job security.
• Get a strong mortgage lender and RTP home buyers agent on your team to build confidenc e.
It's no secret that home lenders now want to be doubly sure any home loan they originate will be solid. This means you'll need to be unusually well-prepared to answer the lender's request for documents, the other broker says.
"All your paperwork must be in order. I recommend that even before you go look at homes, you sit down with a Ann Davis and get all of your paperwork in order."
Also, more lenders are now demanding proof that the funds you've amassed for your down payment have been in your savings or checking account for some time. That means you'll need to produce account statements showing the money is truly your own, which gives you a stronger stake in the home or real estate property you buy.
If you're self-employed, you can now expect your lender to do a rigorous review of documents related to your business.
But the time you spend documenting your eligibility for the home loan will be worth it if your lender gives you a "pre-approval" letter. This you can use as a bargaining chip when negotiating for the home or real estate property of your choice.
• Take your time choosing a home -- within reason.
Many neighborhoods now have an unusually large number of for sale signs. This huge array of choices gives homebuyers yet another reason to delay commitment to any one property.
"If this is the right time for your family to buy a house, don't let the negative atmosphere around real estate discourage you. Use the abundance of choices to help you get precisely what you want," the other broker says.
Here are some other things to consider when buying a home:
- Do you have a home warranty?
- Is the house on a septic system?
- Does the home feature a custom bathroom design?
- Does the master bathroom feature a custom shower enclosure?