A Home Buyer’s Mantra
Buying a Home the RI Real Estate Right Way
Here are a buyer’s formula tips on how to begin the process of buying
your first home, condo or investment property in RI real estate:
A) Home buyers need to be pre-qualified or pre-approved through a reputable lender and some of this is counter intuitive so lets start with some suggestions:
Your Goal: To get the mortgage loan at the advertised lowest rates may not be in your best interest. Let’s talk about mortgage rates, points (costs to you), ability to fund the loan by the lender and closing time frames. Paying points means you are buying down your interest rate by paying more dollars to the lender. In a low rate environment with a conventional or FHA loan it just does not make sense to pay points.
The question for the buyer is how much will it cost you and how long do you have to own that house before you have equity on it. If you are going to sell your home in a couple of years, paying down the points is not worth doing. Usually you break even on refinancing closing costs after year 5 (after refinancing or buying a home). Knowing your lender and whether or not they get loans closed timely is something that is important. Ask your RI real estate agent and listen to them – some lenders do a less than perfect job for their clients and do not close on time.
B) Buyers and whoever is making the purchasing decision need to be available to see the property, have a deposit check with them, and be mentally prepared to make an offer (coming back for 2-3 showings may result in a property being bought by another party). We are moving into a sellers real estate market in much of southern RI and being prepared and ready to buy is important. Know the difference in buying a home or buying a RI condo in regard to monthly association fees, assessments and more.
Your real estate agent can and should be your expert, not your relatives (with some exceptions). I will tell you that relatives interject themselves, trying to be helpful, into home buying decisions and cause much frustration for buyers. Your relatives do not have that experience a real estate agent does. Have relatives step back and learn to do your own due diligence. You have to live in the house right so understand and learn?! A great real estate agent is worth their weight in more than gold in how they guide you with along with experienced home inspectors.
Your Goal: To get the property with the winning offer, act decisively, build into the purchase and sales contract, the ability for due diligence, examination and inspections (all in a timely manner) of the property. Plan to buy with good time frames that make your offer attractive to sellers (find out their needs and see how you can accommodate them). The fewer contingencies you place on the offer, the better you will be in a home buying situation.
C) Buyers need to be able to negotiate the Sale (understand the dynamics, emotions and nuances of a transaction) especially in the early negotiation phase. Having a strong negotiator as an agent is critical to your success in purchasing a piece of property. Put your emotions aside and make it business!
Your Goal: is to buy a property knowing the positives and negatives. As a home buyer you need to be able to negotiate a transaction at the best price which is fair and equitable to all parties that makes a sale. There should be a minimum of surprises to you the Buyer when you have closed on your new home and moved into the ‘new’ property. Have a real estate agent that watches and knows the home inspection time lines of an inspection is critical (testing of radon, well, septic, mold, etc. and receiving results takes time).
D) Buyers need to have a Closing Team assembled. A real estate agent who is available, knowledgeable and responsive, a Real Estate Attorney who focuses on Real Estate Law, a list of reputable vendors for inspections, an insurance company, movers, Lenders who are accessible, competent so that there will be no stumbling blocks (i.e. more money to bring to closing, higher points, inability to perform in a timely manner). I pride myself in associating with and recommending reputable professionals to help with any real estate transaction.
Your Goal: Buyers need to be assured that throughout the whole process (especially when there are bumps in the road ) that the agent you choose as your Buyers Representative has the knowledge, experience and abilities to put the Buyers first. A successful agent builds their business by referrals. If after this real estate experience you recommend my services to a seller to list their property or a potential home buyer then I know I have done my job well.
E) Lastly, understand that with few exceptions most properties are going to have deferred maintenance. In some cases, such items as septic systems, roofs or furnaces may only last a few more years. As a buyer you need to either plan, budget or use tax refunds for these expenses. Other options are available with 203K and portfolio loans and I can discuss those options with you too.
As you will have more questions as this process develops, please remember that I will be available to guide, direct and advise you through this process. It’s the largest purchase of your life so let’s make sure you do it right! Have your buyer’s formula in hand.
Call me now – so I can start the home search and showing process for you! This is what I do everyday with southern RI home buyers to support and guide you to the home that fits your needs. Remember that I cost nothing to you to represent you when buying a property. Whether you are buying or selling in the RI coastal real estate market, I would love the opportunity to earn your trust and business. Contact me Ginny L. Gorman – RI Coastal Real Estate Agent- 401-529-7849 or at ginny@RIHouseHunt.com today.
I service all of RI ‘One Property at at Time well and for your interest only!
This is what a buyer’s formula is all about.