Buying a Home
Whether you are a first time home buyer, purchasing your second or third home, buying an investment property or investing in a vacation home, buying is a huge decision. It can be one of the most rewarding and one of the most stressful experiences a person can have.
Navigating the tricky waters of buying a home is no easy task. But, a good real estate agent can help!
As you go through the buying process, you will normally take the following steps:
• Determine your goals
• Get pre-approved for a loan
• Find a good real estate agent
• Find your dream home
• Negotiate and strike a deal with the seller
• Lock down the financing
• Finalize the deal
TIPS for BUYERS
Finding the Money | Let’s be honest, nothing really matters unless you know how you’re going to pay for your next home or investment property. The reality is that anyone (and I mean anyone) can find the money to purchase a home. In fact, we have seen people who are over $70,000 in debt, unemployed, and on the verge of bankruptcy purchase not one, but multiple homes at the same time. Sound impossible?...read more >
Red Flags Buying a Condo | Condominium ownership is a very new alternative to traditional property ownership. The ability for a group of people to each own their own units, but share common expenses, and still live in harmony has created some huge benefits for buyers. However, if you didn’t know at least some of the benefits, then you likely wouldn’t be considering purchasing a condo in the first place. We will leave the benefits aside for now...read more >
How to Save Thousands on Your Next Home Purchase | Although this is not a comprehensive list of everything that needs to be followed when deciding to purchase real estate it is list of important items that we have noticed at Mayfield Real Estate which can play a big role for most buyers...read more >
Finding the Money
Let’s be honest, nothing really matters unless you know how you’re going to pay for your next home or investment property. The reality is that anyone (and I mean anyone) can find the money to purchase a home. In fact, we have seen people who are over $70,000 in debt, unemployed, and on the verge of bankruptcy purchase not one, but multiple homes at the same time. Sound impossible? Read on . . .
Perhaps you have good credit, a down payment and qualifying for financing will not be a problem, but you want the best mortgage for your needs, and of course, the lowest interest rate available. Sound like you? Read on . . .
...Or maybe you just have no idea what you qualify for, this is your first purchase and you just want to learn how to get started (on the right foot). Well, read on . . .
Below is a brief outline of some basic components of getting financing and some tips to get you well ahead of the game.
TRADITIONAL BANKS
An advantage of using banks rather than mortgage brokers is that you get to deal with someone who knows a lot more than just mortgages. Often, what is best for you in terms of a mortgage might also play into your
Although getting you approved for your mortgage may be your number one priority, a bank will work with you to make sure that whatever you end up with suits your lifestyle and matches your
Some banks even have access to alternative lending sources that may be able to help if your credit is less than perfect or a transaction is out of the ordinary. Ask your banker to find out which options they provide.
MORTGAGE BROKERS
Brokers are typically
One of the greatest advantages of using a mortgage broker is that they work with hundreds of unique situations, often have friends in the right places and know some tricks to ensure your mortgage gets the green light. If a traditional bank denies you, a mortgage broker might be able to help.
LINES OF CREDIT
TAKE NOTE: By financing your home with a line of credit, rather than a mortgage, there are some serious benefits. The line of credit will be secured against the home similar to a mortgage;
CREATIVE FINANCING
How do people buy homes with no money or no credit? Well, some banks still offer zero down mortgages,
Private Lenders–Some lenders will work with
Joint Ventures–Get someone else to front the money for the home and you split the future returns
Vendor Take Backs–Have the owner carry the mortgage
Assumable Mortgages–Agree to take-over the existing mortgage (only available in certain places)
Other Options–Combinations of the above and others unique to the particular laws governing the area
Summary
If you have enough motivation and the proper guidance, there is nothing holding you back from finding the money to purchase real estate. The key thing is to check out all your options. If you plan on spending $100,000’s on a new home, it will be well worth your time to do a little homework.
Don’t let everyone pull your credit rating, have the bank run some hypothetical examples and once you find one or two you trust, then pull the details. The more times your credit is pulled, the lower your credit rating becomes. Get pre-approved and lock into an interest rate. Some lenders will hold a rate for up to 120 days. If the rate is lower when you take possession, you get the lower rate anyway. Don’t get caught if rates climb. Be careful whose advice you take. Some REALTORS® are paid incentives based on the business they send a mortgage broker. Ask your REALTOR® why they recommend someone and if they receive an incentive. Review the terms of your mortgage in depth and be sure you understand the pay-out options, conditions, interest rates, etc. It can be a nasty surprise if your payment suddenly jumps or you have a large penalty for getting out early.
If you are not approved, ask why not and find out what options you have to get approved (if they can’t tell you then find someone else). Sometimes it would just take an additional letter from an employer or something simple to remedy. There is always a way.Source: Lindsey Smith of the Entyro Service Group in Calgary AB
Red Flag for Buying a Condo
Condominium ownership is a very new alternative to traditional property ownership. The ability for a group of people to each own their own units, but share common expenses, and still live in harmony has created some huge benefits for buyers. However, if you didn’t know at least some of the benefits, then you likely wouldn’t be considering purchasing a condo in the first place. We will leave the benefits aside for now…
The items that most of our clients want to know about are the red flags. What items should I look a little more
PLEASE NOTE: These items are only red flags. They are not necessarily problems in
Low Condo Fees
The fees may not include very many of the items they normally would. You may be expected to pay an assessment fee more often.
High Condo Fees
A problem may exist that the condo board is trying to pay for.
Low Reserve Fund
There may not be enough money to cover necessary repairs.
Special Assessments
This is a lump sum of money required to either top up the low reserve fund or to fix an issue the condo has.
Unresolved Issues in the Meeting Minutes
If the most recent meeting minutes say they are waiting for a quote on something, then that something is still broken.
Registered Does Not Match the Listed Size
You may not be getting all the square footage you thought you paid for.
Not All Documents Are Available
This could be a result of poor
Post Tension Cables
If not cared for under the lawful requirements, this style of construction can cost a fortune to repair (typically causes higher fees).
Age Restricted Buildings
This limits who you can re-sell your unit to (or rent). Plus, some lenders will not provide certain mortgages for these buildings.
Any Stains or Signs of Water
This one is pretty obvious.
Lots of Units for Sale
Why does everyone want to sell?
Operating Deficit
If there is more money going out than is coming in, eventually you will run out of money.
Low Owner Occupancy
The one person who owns most of the units has most of the voting power.
Monopolized Ownership
The one person who owns most of the units has most of the voting power.
Unresponsive Board
If they neglect to return calls, what else do they neglect?
Do your homework and get all the information available on a complex. This is always your best security when buying a condo.
Source: Lindsey Smith of the Entyro Service Group in Calgary AB
How to Save Thousands on Your Next Home Purchase
Although this is not a comprehensive list of everything that needs to be followed when deciding to purchase real estate it is
Use a REALTOR®!
As members of the National Association of REALTORS
Have your REALTOR® provide a detailed price evaluation of the property you are purchasing.
In other words, make sure that
Get a home inspection
Many times buyers will choose to purchase a home without having the home inspected by a qualified professional. Many states if an inspection is performed within a timely manner you can generally ask for the seller to repair or fix the items in question or get an allowance deducted from the price of the home. If it is an issue that cannot be resolved you may even be able to be relieved
Enter into a buyer’s agency relationship with your REALTOR®.
It is important to understand that agency issues can play a big role in the purchase or sale of a home. By having real estate agent work with you as a buyer’s agent the agent is providing duties of obligations
Put a good deposit
Often time’s buyers put very little earnest money down when negotiating the purchase of a home unfortunately to the seller it shows little commitment on your part as a buyer to purchase the home. A larger earnest money deposit shows your sincerity and your intent to complete the purchase and can be a big factor in the negotiating of the purchase price.
Watch important
With most real estate contracts to purchase real estate
Shop around for your home mortgage
Often buyers will go to only one lender to apply for a home loan before beginning any initial credit reporting or verification or other signed documents with a lender find out what their interest rate, closing cost
Get a survey
Most title insurance policies in many states do not cover encroachment or survey boundary problems when they arise. After the
Examine your title policy in a timely manner
Make sure that your buyer’s agent and you review the title policy in a timely manner. As noted in previous bullet points above there are certain dates and
Make sure the seller provides a detailed disclosure
Most states now require the sellers to provide comprehensive seller disclosure statements about the real estate they are selling. This can help you as a buyer to determine what or if any problems or issues the sellers have had with the real estate they are conveying.
Ask the seller for copies of warranties on any appliances or work they have had performed
It is generally easier for the seller to find this information prior to closing then after the transaction has been completed. So any type of warranty question prior to the sellers receiving their funds to their house is a good idea.
Take your time before you purchase
It is always a good idea to look at home some homes before making a purchase decision. Don’t feel as though you have to buy the first home you look at. Comparing the one you are interested
Source: John D. Mayfield ABR, ABRM, GRI, e-PRO, CRB
Ready to Buy? Contact us Today!
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Data supplied by CREB®’s MLS® System. CREB® is the owner of the copyright in its MLS® System. The listing data displayed is deemed reliable but is not guaranteed accurate by CREB®. Data last updated on April 8, 2020 9:32 AM.
The trademarks REALTOR®, REALTORS®; and the REALTOR® logo are controlled by The Canadian Real Estate Association (CREA®) and identify real estate professionals who are members of CREA®. Used under license. The trademarks MLS®, Multiple