A home is a major investment. Before you take the plunge, you will want to carefully evaluate the house and the purchase decision. Here are 10 things every homebuyer should consider before finalizing their investment.
Even if you find your dream home, there is no guarantee that you will be able to afford the required loan payments. This is why you should contact at least one lender prior to delving into the home buying process. A lender can pre-approve you for a loan and let you know exactly how much you have to spend.
The amount of space you need will be one of the most important factors to consider when looking at a specific property. You want to make sure the house is large enough to accommodate you now and in the near future. If it's not, you need to determine whether or not it would be financially prudent or even possible to remodel.
Location, Location, Location
You hear this phrase all the time in relation to real estate because it is an essential consideration when it comes to the quality of life you will have while living in the home, as well as the resale potential if you ever do decide to sell in the future. When evaluating a location, pay special attention to the other structures around you and any plans that might be in the works for future structures.
The Local Housing Market
Because the housing market has recently experienced turbulent times in certain areas, it is a smart move for homebuyers to evaluate the local housing market before making an actual purchase. Special items to evaluate include the area's median home price, the average appreciation rate, and the expected growth for the neighborhood in terms of population and employment.
If you will be buying a fixer-upper, it is a good idea to determine what the maintenance issues are and exactly how much it will cost to address these issues. In some cases, the required repairs may end up being more extensive than you ever thought possible. This is definitely something you will want to find out before buying rather than afterwards.
The Builder's Track Record
If you are looking at a home that is brand new, you shouldn't automatically assume that the house is free of defects. New homes can have problems too. This is why you should always check out the builder's track record by talking to neighbors, calling the Better Business Bureau, or by asking the builder for references that you can speak with personally.
The Risk of Natural Disasters
Certain areas are more prone to natural disasters than others. If you are buying a home that is in a flood plain or on a fault line, you will have to deal with the increased risk that comes with living in an area that has a good chance of being destroyed in a worst-case scenario. This may mean buying special insurance or installing structural braces.
Title Search Results
If the home's title has liens against it or other restrictions, the seller may not have the legal right to sell you the home. But, that doesn't mean that they won't give it a try. This is why a title search is a step no homebuyer can afford to miss. When you hire a company to perform the search, be sure you look over the results of their effort very carefully.
The Seller's Disclosure
By law, sellers are required to notify you in regards to any known defects associated with the home or property. These defects may include anything from the presence of lead paint in the home to easements on the property. Before you buy a home, you should carefully evaluate the disclosure statement provided to you by the seller. If you see anything you don't like, now is the time to do something about it.
The final walkthrough is usually your last chance to look at the home before the paperwork is finalized. Take this opportunity to look around carefully. You never know what you may have missed the first time around or what may have been changed since the original offer was made.
More Home Buying Tips
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