Kathy Caufield: Local Home Buyer’s Guide Part 3

Are you perusing one of the many real estate apps with the thought of “if I see one I love, maybe then I’ll make a move,” or maybe you are renting and would consider buying “if one popped up that I really like,” only to find out that by the time you dial the number, it already has a contract? Welcome to the real estate world, and I promise you are not alone.  It’s been a seller’s market for quite some time now, and depending on the type of house you want, it may always be a seller’s market.  There is a process, a “pathway of stepping stones,” that, if you follow, will increase your chances of closing the deal on a house you love.  We have already discussed the first two phases and will continue to the last phase of the process today.  Let’s look where we are in the process.

Initial Phase (Prioritize)

  1. Yes, I want to move.
  2. I want to move to the ______ area, or more specifically, _________ neighborhood.
  3. I MUST have ____ bedrooms, ____ bathrooms, specific school zone, and anything else you MUST have (eat in kitchen, basement, acreage, etc.)
  4. I would LIKE to have _______ (fireplace, flat lot, vaulted ceilings, main level garage, stand up shower, etc.)

Second Phase (Prepare)

  1. Make sure your credit is as healthy as it can be so you can qualify for the best interest rate possible. Take a few months and pay down credit cards. Make ALL payments on ALL bills ON TIME. Doing these two things will make a drastic difference.
  2. Shop around for a lender. Find someone you can really connect with and feel comfortable asking questions to.  All mortgage companies do not offer the same interest rate so definitely take some time to find the lowest rate possible as this will affect your budget. Your mortgage lender can also offer you details on how much you will need for a down payment, plus they can tell you about the different programs offered that may require little to no down payment!!
  3. Once you have connected with a lender and have taken the steps necessary to ramp up your credit score, get a PRE-APPROVAL LETTER. This letter is important for any offer submission and tells the seller that you are 100% committed to purchasing their home and you have a lender willing to back you.  The pre-approval process can take about two weeks, and the letter is typically good for 3 months.  While you are in this two-week waiting period, move on to step 8.
  4. Connect with a local real estate professional. There are so many wonderful agents in our area, and our knowledge of the market and offer process can be what finally gets the deal signed!  Interview agents and find someone you feel comfortable with, someone who listens to your wants and needs, and someone who will keep you at the top of their priorities.  Ask what their “plan of attack” looks like.  There is usually no cost to you to use a real estate agent; in most cases, their commissions are paid by the seller, not the buyer.

By this time, you have all of your finances in order, your credit is good to go, your lender has  made you promise that you are NOT going to make ANY purchases from here on out until you CLOSE on your new house, you have you pre-approval letter IN HAND (or a copy on your computer), and you have made a commitment with a trusted real estate agent.  Now it is time to put your and your agent’s plan into motion in the last phase!

  1. Look at the homes your agent sends you ASAP and let them know which ones you want to see and which to avoid. Hopefully your agent is sending you homes that fit your needs as soon as they hit the market, and maybe even has some knowledge of a few before they ever go on the market. The earlier you can see the home the better.  Don’t fall behind other buyers by procrastinating on this step!  Be flexible in your availability.  If the only time you can go view a house is after 5 pm, you may miss a great house.  Take an early lunch, send a trusted friend or relative, do whatever it takes to get in there and see if you are interested in making an offer. Stay on your game! I’ve heard coaches say over and over “commit to the process!”  The same goes here.
  2. When it is time to write the offer, keep your offer strong. In a hot market, it is very common for homes to sell at or above the original listing price.  (Keep this in mind when you are looking at homes; you may not want to look at the ones that are at the top of your spending budget for this reason.)  Consider waving some various items, repairs, or contingencies if you and your agent are comfortable with that.  Anything you can do to make your offer stand out amongst the others. A streamlined, clean offer with a preapproval letter shows the seller you are serious and ready to act, and that will always be attractive to the seller.

Buying a home is a stressful and confusing process, but following the right steps, working with a qualified lender, and teaming up with a knowledgeable real estate professional, I feel confident you can win in this market!

Kathy Caufield is an experienced real estate agent with RealtySouth. You can submit a home buying and selling question to Kathy for her weekly column by sending an email to [email protected]. Disclosure: Kathy Caufield is also an advertiser in The Gardendale News.