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Your 10 Steps Program To Buying A Home
The key to any success story is proper planning and buying a house is no exception.
How successful you are depends entirely on how well you're prepared and how much knowledge the person you're dealing with has. Simply put, the process of buying a house can go one of two ways - it can be a relatively smooth and pleasant experience or it can be a complete nightmare. What would you choose?
The following report offers the necessary information needed for you to understand the process clearly, thus ensuring that you stand the best possible chance of buying the house of your dreams without unnecessary hassle.
The following report is an attempt to clear the haze around buying the house.
Selecting a Real Estate Agent
The appointed agent is the person who will need to deal with any problems that may arise during the process of buying a home and it's his duty to provide you with the details of any properties that suit your needs.
It's important to select an agent that has the experience and knowledge needed to help you find the kind of home you require. Listing your property with two agents can also be beneficial; should one be less capable than you'd originally believed, the other will be there as a back-up.
Once you select an agent you feel comfortable working with, ask for references before signing him as the buyer's agent.
The Initial Consultation
Once you've appointed an agent the next step will be for you to meet and decide exactly what you'll expect along the way. The following points should be covered during this meeting:
- Exactly what kind of property you require (number of bedrooms, bathrooms, etc.,) in which area you're looking to buy, the price range you're comfortable with and what the maximum time limit is. Bear in mind that the average sale takes 30 to 45 days from contract to settlement.
- How often you'll be able available to view property and what you can expect from your agent in terms of availability and communication (e-mail, daily or weekly 'phone updates, etc.)
- The agent should explain the available finance options and give you details of lenders (usually three). He should explain the difference between the various types of loans and anything else that you might need clarified.
- Any paperwork that you'll need to sign should be copied and a you should be given a brief explanation of each form.
Selecting a Lender
It's usually advisable to go with a lender who's been referred by the real estate agent or somebody who has gone through the process of lending before.
People will normally go for the lowest lending rates but before making a decision it's worth listening to the advice of your agent. Most banks and finance institutions offer the same basic loan with conventional fixed rate, overdraft etc., but your agent will probably understand subtle differences that you may well overlook.
Meet With Your Lender
Arrange a meeting with the loan officer at the first available opportunity to ensure that you understand every aspect of the loan process. In most cases your loan will be guaranteed before you actually choose a property.
It's imperative that you understand what your total monthly payments will be, have a good estimate of the case sum you'll need and what supporting documentation you'll need to pass on to the lender.
Look At Property
Whilst you might like the idea of seeing as many houses as possible, the truth is that if you look at too many, you'll find it difficult to distinguish them from each other. Try to limit the number of houses you see in one day to just two or three.
It's always a good idea to use a checklist to help you keep track of and narrow down the properties you've seen. If, for example, house #2 was better than house #3, immediately eliminate #3 from your list.
Communication with your agent is also important at this stage. As well as letting him know which houses you liked and why, let him know why you didn't like others as this will help him find other suitable properties for you to view. The more information he has, the better he can do the job he's being paid for.
Should you find a property that's for sale by owner, ask your agent to contact the seller to see if he/she will co-operate with a buyer's agent.
Selecting A Home
Once you've found a property that's suitable, your agent will make all the necessary enquiries to help you make your decision. The ultimate decision will, of course, be yours.
Having selected a house your agent will do a comparative market analysis of the property that involves determining "fair market value" by ascertaining what other buyers have been willing to pay for similar property in the same neighbourhood.
Making An Offer and Negotiating
Once you know the fair market value you'll need to decide how much you're willing to pay and what terms before putting in your offer.
Ask yourself the following questions:
- How much do I want to offer?
- How much deposit can I afford to put down?
- When will I be able to settle?
Don't be too rigid during the negotiations and remember not to take anything personally.
Decide what points are not open to negotiation and be willing to give a little on the things that aren't as important to you. A good agent should be able to advise you on how best to structure your offer.
Once your offer has been presented to the seller, either he'll accept outright, reject your offer or make a counter offer of his own. The process of counter offering can go back and forth several times before reaching a conclusion and it's important that both parties remain focused through the process.
Select A Solicitor
Once the seller and buyer have agreed on an offer, a solicitor will be needed to finalise the transaction; the choice usually lies with the buyer. If you don't have a solicitor, your agent will be able to recommend one.
The solicitor will conduct a title search and draw up all the necessary documents. He will also conduct a settlement with the relevant lenders. Most people believe that the solicitor represents the buyer but this isn't the case. His job is to represent the 'sales contract' and to make sure that the terms agreed upon are met.
Closing The Deal
Whoever conducts the final settlement should be able to explain every document in a manner that's understandable to you. If, at any point, the document is not clear, remember that you're always free to ask for further explanations. The agent is being paid to make sure the process goes as hassle-free as possible and it's his duty to make everything clear to you.
At this point it will be decided whether the title coverage will be in your name or just the lender's name. You'll also have to present whatever down payment and outstanding closing-costs.
For most, this is probably the hardest step in the process. However, with some simple planning and forward thinking, most moves go very smoothly.
Make arrangements with a removal company as soon as possible. Rates vary considerably so it's worth calling several and comparing quotes. Most will want to come to your home to get a better idea of how much will need to be moved, the size and weight of your furniture and the distance to your new home.
Contact banks and other creditors at least 30 days in advance to advise them of your new address. In order to avoid late payments, it's always a good idea to call and verify that the bank has received your notice of address change.
Remember to call the necessary utility companies to have them disconnected from your old home and re-connected to your new home at least 10 days prior the moving date.