When you first begin looking for homes for sale, it can be a very exciting time. You’ve discussed what to look for in a new home and might be working with a home builder and have been explained the best ways to how to buy a new home. However, buying a new home is not without it’s risks and negative aspects. Here are a few things you should know if you want to know how to buy a new home.
Do Your Research
I’m sure you have heard this time and time again but you really need to make sure that you find out everything you can about how to buy a new home before you actually settle down and sign on the dotted line. Unfortunately, there are real estate agents and even contractors who can tend to take advantage of first time home buyers because they realize that they don’t do the research necessary and can swindle them out of more money than is necessary. Here are a few fatal mistakes than many home buyers make.
- Commitment Before Approval
Don’t go house hunting before you have been approved for your loan from a lender. The risk there is that you could find a house that you absolutely fall in love with only to find out that the mortgage is way out of your price range. When this happens, it can go one of two ways. One is that you get the house anyway and end up suffering with the out of budget costs until you can get rid of the house. Or, you walk away and then compare every other home that you look at to that one. Which of course, will be nicer than anything you’ve ever seen in your opinion because it was your first love. Don’t let your emotions and excitement get the better of you. Be patient and wait for your loan to go through so that you can only look at homes that are in your correct budget range.
- Failure to Negotiate
Everything is negotiable. Many new home buyers do not negotiate because they are uncomfortable with being disagreeable or confrontational. However, everyone in the home buying process is prepared to negotiate and these negotiations don’t have to be a negative experience. If you will negotiate, you will probably walk away with a much better deal than you expected to get. Lenders, real estate agents and builders expect negotiations so their starting prices are usually higher than what they intend to settle on. Either that or you could end up getting a lot of upgrades included in the original price. Keep in mind that you hold all the cards. If you back out, you will lose the house but there will be other houses. However, the contractor or lender will lose your business and that is a lot more important to them than the house.
- Signage Before Knowledge
Before you sign with a builder, it’s important to find out the reputation of that builder. You don’t want to commit to using a certain builder, only to find out that they have terrible reviews and reputation. You should always find out if others that have used said builder had any problems or issues and what they were and how quick he or she was to address the issues.
- Forgetting the Punch List
You always need to see a punch list. This is the list of issues that need to be fixed. A good builder will make this for you without being asked but never assume that it is going to be done. It may be simple fixes such as popped nails or screws but it could be a big deal. Either way, you should never close on a home before you have seen the punch list.
You may feel that you have all the knowledge on how to buy a new home but there is always something more that you could find out, if you really wanted to. There’s no such thing as too much information when it comes to buying a house. There should be no surprises or skeletons in the closet that you find out only once you have closed. That could be detrimental to you.