House Buying Tips
By Steve Gillman - 2006 - 2014
Here's a collection of house buying tips that will be added
to from time to time. Feel free to copy or print the information
here, so you won't forget anything when you are out house hunting.
House Buying Search Tips
Work with the right real estate agent. If you tell him you
want a house in town, and he insists on showing you houses out
in the country, get rid of him. A good agent should listen well,
and help you find what you want. Remember, though, that if he
is a seller's agent he is working for the best interests of the
seller, no matter how helpful he may be. So don't mention that
you can go $5000 higher on your offer, as he is obligated to
tell the seller what you said. You may want to consider hiring
a buyer's agent.
Note: The industry has changed since this page was
first posted. Many agents automatically take the role of buyer's
agent when showing homes other than their own listings. But it
is still a good idea to not reveal too much about your negotiating
stance. And be aware that agents
are not always buyer's agents just because they act like
it. Unless it is clear that they represent you, they probably
are working for the interests of the seller (and although it
may sound cynical, it is worth noting that they are always working
for their own interests as well).
If you are looking at houses for sale by owner, whether in
the newspaper, or just by driving around, be careful. An owner
selling a home on her own may not be aware of the laws requiring
full disclosure of any defects in the home. Also, since you will
not have the closing help of the real estate agency, be sure
to at least get your documents reviewed by an attorney specializing
in real estate, before you go to closing. If you follow these
precautions, you may find a better deal with an owner
who is trying to save the sale's commission.
You may want to first find the areas or neighborhoods that
you like, before you start looking at a specific house for sale.
Buying in the wrong place can be a big mistake, especially if
you are looking in larger cities. Remember these tips: Look for
bars on windows and other signs of crime worries; Walk the area,
and talk to anyone you meet; Ask if the area is in decline or
getting better; Look for street lights; Notice the condition
of the houses and yards; Drive the likely routes to jobs and
stores. Trust your intuition.
If you are prescreening neighborhoods without visiting, you
can use Google Maps
to "walk around" using the "street view"
House Buying Financing Tips
Go to a bank or other mortgage lender, and get prequalified,
so you know what price range you can realistically look at. Even
better, get preapproved, so a seller knows you can follow through
on any offer you make. Preapproval gives you negotiating power
and an advantage over other potential buyers, even if they offer
a little more (you are the "sure bet" after all). For
more information on this, see the page; Loan
Get educated. Don't trust the banker or mortgage broker to
tell you everything you need to know. Their job is to sell you
their products. They can be entirely honest and well-intentioned,
and still sell you a loan that isn't in your best interest. Check
out the page on Financing,
and at least get familiar with the terms in the glossary there.
Be prepared financially before you start your house
buying adventure, or be prepared to have your heart broken. Many
offers fall through when the buyer discovers they don't have
the credit score necessary to get the loan, or they don't have
the 10% down payment required by the mortgage company.
Here are some more specific tips: Save enough money for a
decent down payment and to cover the closing costs; Check out
your credit score and get it into shape, if need be; Get prequalified
or preapproved for a loan; Be sure you are ready for the costs
of maintaining a home, and, finally; Have some extra money set
aside for the "surprises", which are regular feature
of real estate transactions.
House Buying Inspection Tips
You will likely want a formal home inspection when you buy
a house. This is often part of the offer - the contingency being
that you can get an inspection within a certain amount of time,
and walk away from the deal or renegotiate if problems are found.
Since these inspections are expensive and usually paid for by
the buyer, do your own thorough inspection first, even if you
plan to pay for one. If you find deal-breaking problems before
you make an offer, you saved yourself the inspection expense
Below are some house buying tips in the form of a list of
things to look for, and questions to ask. Not all of them will
be relevant to your situation, so pick and choose. Obviously
you may not be qualified to answer some of the questions (Does
the wiring look normal?), but you can look for things that don't
seem right, to have the inspector check out later.
Why is it being sold?
Are there any problems with the house?
Ask for the utility bills for the last year.
Talk to the neighbors about the area.
Take notes when you look at the house.
Does the yard slope towards the house (drainage problem)?
How many years does the roofing have left?
Do all the windows open?
Does the wiring look normal and up-to-date?
Are there any cracks in the foundation?
Are the fences in good shape?
Are there any problems with the driveway?
Is the garage floor cracked?
Does the garage door work fine?
What interior fixtures are included?
Are there sufficient outlets in every room?
Flush the toilet and try all faucets.
Test all lights and ceiling fans.
Test the stove and other appliances that are included.
Look in the attic for evidence of animals.
Is there sufficient insulation?
Is the roof sagging?
Are any of the walls cracked or sagging?
Are the ceilings in good shape?
Are there fuses or breakers (the latter are preferable)?
Does the furnace look okay?
Does the water heater look okay?
Is there any moisture in the basement?
Do the floor beams look good?
Do the supports look okay?
Does the sump pump work?
Are there any cracks in the basement floor?
Do the stairs sag when stepped on?
Does the air conditioner work?
What does your intuition tell you?
Check back for more house buying tips in the future (new additional
are announced on the homepage). Also, you can visit our checklist
page for a complete Home
Inspection Checklist for both home buyers and investors.