When you’re looking to buy a home, you may wonder, “Does it matter if the property is listed with a real estate agent or a for sale by owner who are trying to sell it themselves?” Um, yes. It matters. A lot. The truth is: When it comes to signing contracts, handing over escrow money, and digging into the home’s history, going it alone can end up costing homebuyers a bundle.
The following are 6 reasons to avoid a For Sale By Owner (FSBO) home.
1. Are you sure it’s legit what they are selling?
Unfortunately, scams abound and the real estate industry isn’t immune, specially if buying a for sale by owner. If you don’t have an agent looking out for your best interests, it’s easy to be duped. For example, would you know what a proper sales contract looks like if real estate is not your field of expertise? Depending on the state in which your reside, there are a number of legal forms that must be completed. In addition to a contract, property disclosures, occupancy agreements, and lead paint records are just a few documents that must be signed. Because a for sale by owner is not bound by a code of ethics as Realtors® are, there’s no way to be certain they won’t try to take an unsuspecting buyer for all he or she is worth. No would-be buyer should suffer sleepless nights wondering where that escrow money ended up.
2. Full disclosure When Selling
Obviously, when you’re making a significant investment you want access to as much information as possible. Real estate agents have the ability to get you the answers you need. Whether it’s about repairs made to the home or liens against the property, the more you can find out, the better off you’ll be when it comes to negotiating. Plus, no one likes an unpleasant surprise when it come to a for sale by owner. Remember: Knowledge is power. On your own, would you know what to ask a seller? And, more to the point, would you know if a seller is hiding key information? It’s a risk better off not taking.
3. Are you a skilled negotiator?
In the course of doing business, you’ll probably have to go back and forth quite a bit — and not just about the price of a for sale by owners home. What if repairs need to be made? Are you ready to haggle over who takes care of a leak or a structural issue? What if you can’t agree on a closing date? When you have an agent, he or she will handle all that for you.
4. Is money an issue?
The main reason sellers choose to sell their homes as a for sale by owner is to save money by not having to pay an agent’s commission. So what happens if your seller is strapped for cash but problems pop up during a home inspection and they can’t afford to fix them? This, in turn, raises a red flag as you start to wonder if they took the cheap way out when making important home repairs.
5. Are you ready to deal with a for sale by owner all the time?
When it comes to arranging the home inspection or any other viewings of the house, your agent can serve as your go-between so you don’t have to contact the homeowner repeatedly. Unless you’re completely comfortable making all those appointments yourself, you should probably have someone representing your best interests.
6. What’s the timeframe for selling?
When a seller hires an agent, you know they’re serious about making a deal. With a for sale by owner, are you sure the sellers are really going to get moving? Some may have put the home on the market just to see what offers it could attract. If you’re an interested buyer, you need to know that the seller is just as eager to make a move; otherwise you’re wasting your time and getting your hopes up for nothing.
Of course, there are honest for sale by owners out there, but when it comes to making one of the largest investments of your life, you don’t want to take any chances. Having a real estate agent working on your behalf at every stage of the transaction can offer peace of mind and end up saving you money and countless headaches.
When looking to purchase a home in Oakland County, Michigan for the first time can be a difficult proposition and for for many potential buyers, one of the biggest obstacles on the road to homeownership is saving for a down payment. But thanks to a new technology trend, some savvy buyers are turning to their friends, family, and social networks for help in their home purchase these days, and it seems to be a trend that is spreading across the country. It is clear that technology and social networking can be a great way to stay tuned socially and in business, but now it has gone to a whole new level with CrowdFunding to help wanna be homebuyers reach their down payment goals by reaching out socially for assistance.
The CrowdFunding Trends
While crowdfunding has long been a popular trend, until recently it’s been mostly limited to the business world, but this is now changing to the private sector as well. According to a recent article in The Wall Street Journal, crwdfunding for home purchases is on the rise. There’s even a crowdfunding platform specifically for homeowners. HomeFundMe is the first platform specifically targeted to potential homeowners looking to fund a down payment. Potential homeowners are given 12 months to reach their down payment goal, and all funds are wired from an escrow account to the seller when buyers make their property purchase.
HomeFundMe is still new (the platform launched in October 2017), but results so far are promising; according to the WSJ article, approximately 400 potential homebuyers have used the service to help crowdfund their home purchase down payments since the launch.
If you’ve been thinking about buying a home but haven’t been able to save for a down payment, crowdfunding could be a way to make your dreams of owning a home a reality.
One of the biggest hurdles in the home buying experience is the approval of mortgage. However, many buyers set their heart on a house that does not fall under their budget. Today, while the inventory is quite stable, multiple offers are on the rise. You have to compete with other buyers to come out at the top.
From loan programs to repairs, home inspection and other costs, you need to plan for everything in advance so that no surprises face you in the future. It’s important for you to take notice of everything the seller says in the first meeting because this will help you during the negotiation or when you are preparing a counteroffer.
Following are some of the things you need to work on before and while meeting the sellers:
When searching for a home for sale in Oakland County, Michigan, create a list of all the features you are looking for in the house. This will help you remain under the budget. A key to making this experience easy on yourself is to set a low budget. Give yourself some room to raise the budget in case you find a house that you fall in love with. This way, you will be able to negotiate with the seller on the price and give him the impression that you are going out of your range.
Maintain a Poker Face during Negotiations
Buyers beware… think before you say anything in front of the seller. It’s possible that during the negotiations, your own words might bite you back. Moreover, when touring the house, assume that the seller has eyes and ears everywhere. Any offensive comment you pass might affect the buyer negatively. Just because of a simple conversation that you and your wife had amongst you, the buyer might decide to cancel the deal with you.
Home Buying Experience Qualifying Questions
You won’t seem nosy at all if you start asking the seller questions one after the other. You are going to make such a big purchase, so it’s your right to know everything about the property and the seller.
Following are some examples of questions you should ask for a great home buying experience:
When will the seller move?
What kinds of repairs are needed?
Has the seller received any other offers?
How long has this Oakland County, Michigan, been up on the market?
How much are utilities, taxes and interest rates?
Are there any restrictions from the HOA? (Home Owners Association)
Does the seller want you to pay the closing cost?
Are pets allowed?
Can the buyer recommend any lenders who will expedite the mortgage loan process?
Explore the Neighborhoods
Do you have kids? Are you planning to have them in a year or two? If you are, then you need to explore the neighborhoods before buying a home for sale Oakland County, Michigan. Talk to the people living in the neighboring houses, check out the parks, and visit the community center. Have a feel of the place and then decide whether you are ready to move here or not.
Remember, You Are Just a Guest
Don’t go using the bathroom while you are touring the house. Turning the taps on and off in the bathroom or pressing the flush handle is fine, but don’t make yourself at home. Be respectful and do not go into the rooms that the seller has cornered off.
Take Pictures with Permission
You want to share the home buying experience you had during a house tour, which is completely fine, but don’t start clicking pictures without the seller’s permission. It’s common courtesy!
Before you forget what features you saw in which house, create a list of pros and cons. This will help you make the right decision when you finally sit down to choose the house you liked the most. If you want to buy a home for sale in Oakland County, Michigan, that falls under your budget and has all the features you need, then visit Homes2MoveYou.
Before you even think about buying a home for sale in Northville, Michigan, why not have a look at your financials. Most people believe that the mortgage loan they will apply for will cover all the costs but there are few fees that you will have to pay out of your own pocket. For this reason, you need to have enough savings, so that you can cover the service charges and the real estate agent’s fees.
We like to call these extra costs as fee myths, which buyers think are not real. So, what is the first payment that you need to have on hand to make an offer?
The down payment!
Here’s some good news: you don’t have to pay a 20% down payment when buying a home for sale in Northville, Michigan. Most lenders ask for a 3.5% down payment that is if you have a clean credit card statement. If your credit score is below 600, then be prepared to pay a minimum of 10% down payment.
Following are the fees explained briefly in order:
1. Appraisal Fees
The appraisal fee is the assurance which the lender needs before giving you the loan. It’s insurance against the proof that the loan amount you are asking for matches the house’s value. This fee costs somewhere between from $200 to $425.
2. Home Inspection Fees
The most important thing to keep in mind is that never let go of a home inspection in return for an incentive. The few dollars you will be saving now will cost you thousands in the future. From assessing leaks and molds to plumbing problems, the HVAC system, roof and gutter, everything comes under this. Do not send an offer until you have the home inspection report in your hand. This fee costs somewhere between from $300 to $500.
3. Application Fees
The application fee is the fee the real estate agent needs to run your credentials for the credit report. It also involves a few other fees, which is why it is important to ask your real estate agent for a final cost and its breakdown. This fee costs somewhere between from $75 to $300.
4. Lender’s Origination Fees
The amount charged on the loan is known as the lender’s organization fees. It includes charges for underwriting the loan, funding the loan and loan application. This fee is usually 1.5% of the loan.
5. Titles Services
A title search allows you to make sure that the home for sale in Northville, Michigan you are looking to purchase is not owned by someone else. Through this process, you can make sure that you are not being scammed. This fee costs somewhere between from $150 to $400.
6. Survey Costs
Want to know about the house’s major features and dimensions then you need to pay fees that’s somewhere between $150 to $400.
7. Tax Service Fees
Taxation fee cost is $50 and is paid to make sure that the tax payment documents are in order.
8. Private Mortgage Insurance
Buyers, who are lucky enough to pay a 3.5% down payment, are subject to pay private mortgage insurance, which can be from 0.3% to 1.5% of the loan. This is an assurity that if you fail to pay back the loan and your house forecloses, the lender will be safe.
So, there you go… home-buying fees that up until now you considered a myth. Before placing an offer on the home for sale in Northville, Michigan, visit Homes2MoveYou. Get in touch with a real estate agent and get the house appraised from experts.
We are sure that you are familiar with the battle of needs vs. wants… what we like to call must vs. lust. It’s a battle where you spend a lot of time fantasizing about the changes you can make in the home for sale in Farmington Hills, Michigan you just bought and then act on them without giving your needs a second thought. It’s time you stopped making frivolous purchases for your house.
However, in order to satisfy your inner shopper and give you a way to let all that new-house excitement out, we have come up with a few tips to keep you in line.
Most first-time home buyers find themselves in a situation where they are torn between the responsibility of taking care of a house repair or buying something that they don’t actually need. Here’s how the inner conversation usually goes:
“This 50″ LCD screen on sale is once in a lifetime deal. Maybe, if I schedule the plumbing repair for the next month, I can include this LCD in my budget.”
Never do this! Plumbing and structural repairs are the ones that should be fixed immediately or you might find yourself paying thousands of dollars for something that could have been easily taken care of by tightening a bolt.
So, follow the below tips to put your needs first when shopping for the house:
Make a List with All Your wants in a Home for sale in Farmington Hills
Now that you have paid the real estate agent his commission for the home for sale in Farmington Hill, Michigan he bought you, you will find yourself short of funds. So, before you set foot out for shopping, create a wish list. Once the list is made, narrow down ten repairs and items that are necessary.
The wants that you have prioritized automatically become your needs in a Home for sale in Farmington Hills, which bring us to our next point:
Highlight Those Needs that are Important
Take the “top 10” list and now prioritize the items on it according to what requires immediate attention. Separate the DIY jobs from repairs that require a professional’s hand.
For example: you can paint walls on your own but you cannot replace the broken shingles on the roof.
Obviously, the latter repair requires attention now, as it can cause damage to the house during a heavy downfall. The former can be done anytime, when you are settled in.
Keep the List on You When Shopping
It’s possible you might get sidetracked by something you see on sale in the store. The list will work as a reminder that you are on a budget. This way, you will think twice before making a frivolous purchase.
So, are you ready to hire a real estate agent to find your dream house? Use these tips wisely and you will be able to fulfill your wants sooner down the line. If you want to buy a home for sale in Farmington Hill, Michigan that falls under your budget and has all the features you need, then visit Homes2MoveYou. Get in touch with a real estate agent and start seeing houses in areas of your liking.