A Buyer's Guide | CENTURY 21

A Buyer's Guide < >

Buying a home is a significant and exciting decision. This section provides professional real estate advice and helpful buying tips.

What's Right for You?

Before deciding which house to buy, consider your lifestyle, current and anticipated housing needs and budget. It's a good idea to create a prioritized list of features you want in your new home; you'll quickly discover finding the right home involves striking a balance between your "must-haves" and your "nice-to-haves".

If you enjoy cooking, you will appreciate a well-equipped kitchen. If you are into gardening, you will want a yard. If you have several cars, you may require a larger garage.

Next, think about what you might need in the future and how long you are likely to live in this particular home. If you are newly married, you might not be concerned with a school district right now, but you could in a few years. If you have aging parents, you may want to look at hoes that offer living arrangements that could accommodate them as well.

It is important to think about your new home's location just as carefully as its features. In addition to considering the distance to work, evaluate what matters to you in terms of services, convenience and accessibility, such as shopping, police and fire protection, medical facilities, school and daycare, traffic and parking, trash and garbage collection, even recreational facilities. It is also important to consider the type of home that suits you best. Is it a condominium, townhouse, or detached single-family home? Do you want brick, stone, vinyl, or something else? Do you prefer a new home or an older one?

Be sure to talk with me about where you want to live and what is most important to you. I can help analyze data, answer questions, share my professional expertise, and handle all the paperwork and legwork that is involved in any real estate transaction.

What Can You Afford?

How much can you afford? Review your income, savings, and debt to figure out how much home you can afford.

How Much Can You Afford?

Now that you know what you are looking for, the next step is figuring out what type of home you can afford. A review of your income, savings, monthly expenses and debt will be necessary.

Early in the process, you will want to get pre-qualified for a mortgage loan. It enables you to move swiftly when you find the right home, especially when there are other interested buyers. It also indicates to the seller that you are serious and can afford to buy the property. A pre-approval is a simple calculation done by a mortgage lender that tells you the amount you will be able to finance through a loan and what your monthly payments will be.

The price you can afford to pay for a home will depend on several factors, such as:

  • Gross Income
  • The funds you have available for the down payment, closing costs and cash reserves required by the lender
  • Your debt
  • Your credit history
  • The type of mortgage you select
  • Current interest rates

Another figure that lenders use to evaluate how much you can afford is the housing expense-to-income ratio. It is determined by calculating your projected monthly housing expense, which consists of the principal and interest payment, property tax payments and insurance premiums on your new home loan (also known as PITI).

Each buyer is unique, and a mortgage can help you find out just what you can afford. Your income and debts will typically play the biggest roles in determining your price range.

Know Your Neighborhood?

Evaluating a neighborhood and surrounding areas thoroughly is essential.

When you buy a home, you are investing in a community. You will spend a significant amount of time and money supporting the schools, community organizations and commercial centers in the area. Before you make the final decision, take a good look at the location and make sure it fits your lifestyle.

For example:

Evaluate the property's proximity to other important locations in your life. How long will your commute time be? Is there a hospital or doctor's office nearby? What about schools, childcare, shopping, family and friends?

Make sure you feel comfortable in the area. Drive around the neighborhood at different times of the day and night on multiple days of the week to observe activity and noise levels.  An educated buyer is a happy one!!

Visit and understand the school district. Even if you do not have children in the school system now, you may same day. The district reputation could positively or negatively impact the selling price of your future home as well.

Already Have a Home?

Buying a home while selling an existing home has its own set of considerations; this section provides expert buying advice and can help you navigate these challenges successfully.

What if You Already Have a Home?

Buying a new home and selling an existing home at the sometime has its own set of challenges. With knowledgeable planning, you can ensure everything goes smoothly.

Before putting your home on the market or committing to buying a new one, take a look at the prices of houses in the areas where you will selling and buying. You will need a realistic idea of sales prices for similar houses, so you can assess both your buying and selling position.

What if you are unable to time the sale of one house with the purchase of another? You may own no houses for a time, in which case you will need money in the bank and a temporary place to live. Or, you may own two houses at once. That is why it is important to have backup plan. Here are some options to consider:

  • Research short-term rental and storage options (family, friends, storage facilities, containers)
  • Bridge financing (a short-term loan) for the down payment on a new home backed by the equity in your old home.

Shopping for a Home

As your agent I can help you look for a home, compare homes, and compile your individual wish list to find the best home for you.

Buying a home is one of the most important decisions you will make. That is why it is your best interest to choose an experienced real estate agent who listens to and understands your needs, and has detailed knowledge of the area in which you want to live.

If you allow me the opportunity to work for you, you are dealing with a professional who understands your concerns and will provide you with the personalized service that makes all the difference.

What should you expect in your first meeting with a real estate agent? I will typically talk to you about the neighborhood where you want to live, home prices, schools, and the surrounding commercial and residential areas. I can also address the pros and cons of being a Buyer's Agent, Sub Agent, or Dual Agent.

When you are ready to visit houses, call me and ask me to help you with:

  • Arranging showings
  • Tracking the properties you have seen
  • Identifying homes that meet your criteria and keep track of your "what is right for you" list

A brief word of advice, after touring each home, write down what you liked and did not like about the home.

Making an Offer

Making an offer to purchase a home has its own set of factors. Let my knowledge and experience make your offer be a successful one.

Once you have found your ideal home, it is time to get started with the financial and contractual side of the purchase. Let me guide you through this process. Purchase contracts vary in length and terms from state to state, and sometimes with a state.

Multiple offers on the same home are not uncommon, so you may only get one chance to make an offer that the seller will consider. That is why it is important to think carefully about your strategy. In most cases it is better to have your real estate agent present the offer. If you have any personal interaction with the homeowner, avoid sharing any information about your move, your current housing status, financial status or your feelings about their property- positive or negative. This could work against you in future negotiations.

You, as the buyer, and the seller have different goals, so it is important to consult with me, your agent, to help bring order to the process and know which questions to ask and to help you reach a desirable outcome.

How Much Do You Offer?

How much should you pay for the home? This section will help you determine an appropriate amount to offer to secure a winning bid.

How Much?

I can help you find out what other homes have sold for in the area, and how much money you might have to put into repairs or renovations. These considerations should be a factor along with the amount you are comfortable spending.

In addition to sale prices of other comparable homes, there are several ways you can come up with a winning bid. For example:

  • The condition of the home. Is the home in move-in condition, in need of paint and other cosmetic improvements or a fixer-upper that needs real work?
  • The market. If you are in a buyer's market-where there are more homes for sale than there are people to buy them-prices are probably stable or falling. If you are in a seller's market-where there are more buyer's looking for homes than there are homes for sale-prices are probably moving upward.
  • Your ceiling. If you have a credit pre-approval, you know how much you can borrow for your home purchase. Of course, you may not be comfortable paying as much as you have been approved to borrow, so think carefully about your financial situation before making an offer.

Next, decide how much you are willing to pay for a home. Remember, the advertised price of a house is just a starting point - it may take quite a bit of negotiating to arrive at a final cost.

The value or disadvantage of certain features can help or hurt resale. In some areas, a swimming pool actually detracts from a home's value, and makes it harder to sell. In neighborhoods with two-car, attached garages, a single care or detached garage may affect the home sale and future value.

All Cash

If you are planning to buy a home with cash, this section provides some useful information to make your transaction a success.

Buy a Home with Cash

Though most buyers do not buy a home with all cash, anyone considering such a move may be wondering how it is done. Because all cash buyers sidestep the time-consuming loan qualification process, the deal can close very quickly. The primary advantage of buying a home with cash is completely avoiding mortgage interest. Buyers also save money that would be spent on loan origination fees, required appraisal, some closing costs and various other changes imposed by the lender.

Inspection

The home inspection is an important step in the buying process. This section offers helpful information that can help to avoid potential problems after the purchase is complete.

Home Inspections

CONGRATULATIONS!! You have made an offer, and reviewed all the documents the seller has provided regarding the condition of the home. But, one important step before you finalize your real estate offer could help you avoid costly home buying mistakes. Hire a professional home inspector to give the home a standard inspection that includes

  • Room-by-room review
  • Exterior home components
  • Electrical systems
  • Foundation and structural components - both interior and exterior
  • Heating/aid conditioning systems
  • Plumbing systems
  • Attic/basement crawl spaces

Once you have arranged for a home inspection, plan to accompany the inspector for the entire procedure. You have the right to be there, and leading home inspection companies will encourage your presence. It helps you to better understand the findings in the report and will reduce post-closing surprises. Do not forget your list of questions and items of concern.

A thorough home inspection convers more than 1,000 items, everything from foundation to roof, and takes two to three hours depending on the size and age of the property. The report should reflect the condition of about 400 items. A typical inspection can range from $300-$500.

Some common items a home inspection could uncover are:

  • Maintenance problems such as rotting decks, water damaged ceilings, etc.
  • Electrical problems (even faulty fuses can lead to bigger difficulties in the future)
  • Drainage problems, which could include water intrusions below the home
  • Roof leaks and defects from aging
  • Poor ventilation, especially in an attic; this is the time to assure that all vents are clean and working properly
  • Excess air leakage due to poor weather stripping and subpar caulking around fixtures
  • Failed window seals, which are routinely found with dual pane windows
  • Environmental contamination caused by asbestos, mold, formaldehyde, lead paint, radon, soil contamination and/or water contamination
  • Faulty lines in water heaters, overflow piping and/or hazardous flue conditions

Structural damage caused by water seepage into the foundation, floor joists, and door headers should be discovered at the source, and should be identified with a home inspection.

Insurance

This section explains how homeowners' insurance protects your interests in the event of natural disasters and catastrophic events.

Homeowner's Insurance

Protecting your new home with insurance is a must. How well you do that depends on the details of your policy. And while you are not required by law to have homeowners' insurance, mortgage lenders require that you do.

A standard policy will suffice in most instances. It protects against several natural disasters and catastrophic events. However, it will not guard against earthquakes, floods, ware and nuclear accidents. The policy can be expanded to include these disasters as well as coverage for such things as workers' compensation. In fact, the lender may require that you purchase flood or earthquake insurance if the home is in a flood zone or a region susceptible to earthquakes.

You can also cover the depreciated value of personal property, such as televisions and furniture, by purchasing a replacement-cost endorsement. This is an extension of coverage that can enable you to replace the item with one of comparable material and quality.

Timeline & Paperwork

In the home buying process, ownership of the home is officially transferred to you at the closing meeting. Know what to expect when you close on your new home.

Home Buying Process - Timeline and Paperwork

Closing can also be referred to as settlement of escrow. As your local Century 21 agent, I will guide you through the closing process.

In general, ownership of the home is officially transferred from the seller at the closing meeting. Most of the people involved with the purchase of your home will attend the closing.

In advance, a title company is usually hired to conduct a search for any recorded documents that affect the deed to the property. Examples include easements, liens, tax assessments, covenants, conditions and restrictions, and homeowner association by-laws. The lender must approve the preliminary title report prior to closing.

Once the conditions of sale have been met and the preliminary title report has been approved, all parties will agree to sign closing documents. The preliminary title report then becomes the final title report, on which any applicable title insurance is based.

If everyone agrees that the papers are in order, the buyer submits payment to cover the closing. If the lender will be paying your annual property taxes and homeowners' insurance for you, a new escrow account (or reserve) is established at this point.

Once all the proper documents have been signed, the attorney who is handling the closing will record the new deed at the local Register of Deeds.

Finally and here is the best point, you receive the keys to your new home.

Moving In

The home moving checklist below may help make your move much easier.

6-8 Weeks Prior

  • Purchase or rent moving supplies: tape, scissors, markers, pocketknife, newspaper, blankets, moving pads, plastic storage bins, rope, and a hand truck. You may be able to obtain free boxes at local supermarkets, but consider purchasing wardrobe boxes for clothes.
  • Have a garage sale to clear out unwanted items and plan accordingly. Consider donating unwanted items.
  • Keep a detailed record of all moving expenses. Your costs (and donations) may be tax deductible depending on the reasons for your move.

2 Weeks Prior

  • Hire a reputable mover or rent a moving truck. Be sure to get referrals or references, check with the local Better Business Bureau, get estimates and purchase moving insurance.
  • Two weeks before moving day, contact your telephone, electric, gas, cable/satellite, refuse and water companies to set a specific date when service will be discontinued. Contact utility companies in your new town about service start dates, including Internet and telephone services.
  • Notify healthcare professionals (doctors, dentists, veterinarians) of your move and ask for referrals and record transfers.
  • Register children for school and ask for school records to be transferred.
  • Notify lawn service, cleaning and security companies when service should be terminated.
  • Advise post office, publications and correspondents of change of address and date of move.
  • Check your homeowners' insurance and make arrangements for new coverage.

Moving Day

  • Have tools handy for breaking down beds and appliances.
  • Give every room a final once over. Do not forget to check the basement, yards, attic, garage, and closets.
  • Have the final payment for the movers and money for a tip.
  • Do not forget to check in with me, as I may be able to provide useful local advice and/or referrals.

Tip:Move valuable (jewelry, legal documents, family photos, collections) yourself - do not send them with the moving company. Make sure that you have a complete home inventory of all your possessions.


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CENTURY 21 Newsom-Ball Realty

Morehead City, NC   -  252.240.2100