So, You Want to Buy a House, Pt. 2
Okay, in the last section we talked about getting your credit report cleaned up. And, if you did the mathematical homework, you have a rough idea of how much you can afford to buy. The next question is, what neighborhood has homes in your price range? It’s time to hit the streets.
Agents hold open houses on Saturday and Sunday. Educate yourself as to where you can afford to buy simply by driving around and looking for Open House signs.
Check out Realtor.com; it has the best search engine. Enter a city where you think you would like to live, enter your maximum amount in the “Any Price” link on top. Then click “More” and in the “Expand Search” area, click the “Select Nearby Areas” and you’ll see options for surrounding cities/towns. Open each listing and, if you like it, print it. Hint: No more than five at a time; you can’t remember more than five in one outing. Print the map, too.
Obviously, the house is important but it’s not the only criteria. Commute, schools, and shopping are important, as well. In may seem irrelevant but, if a trip to the supermarket is 15-20 minutes each way, that can be a huge inconvenience.
Choosing the number of bedrooms and baths is personal preference; most people like to have a spare bedroom which will double as an office, or playroom, or guest room. Hint: older homes have larger rooms than newer homes but, they probably have a formal dining room which almost nobody uses anymore. The great-room concept came into vogue in the 80’s and 90’s and the kitchens got bigger but the bedrooms got smaller.
Let’s talk about real estate agents for a minute. I’m not a fan of hiring your friends or extended family members just because they have a real estate license. I speak from personal experience, that can be a recipe for disaster. At the very least, you may lose a friend or create problems with family. (I speak from personal experience.) You should find 3-5 that you like and interview them. How do you find them? Open houses is one way but, agents who hold open houses are there for one reason, to meet buyers like you. Top producing agents don’t hold open houses however, they may have a “buyer’s agent” who works on their team who does. That is okay because you have the knowledge of an experienced agent overseeing the transaction.
According to the California Association of Realtors®, the average agent closes eight transaction a year; in my opinion, that’s not very many. We become competent by doing, whether it’s driving a golf ball, learning a foreign language, or dancing the Merengue. I don’t know how a real estate agent can become competent by closing eight transactions a year? Fortunately, there are agents who close considerably more than that; that’s who you want working for you. How do you know how many transactions they have closed? Ask them. And, ask them for references and call the references.
When you find an agent who is a good fit, a model match, offer to sign an exclusive buyer’s agreements. That means you will only work with that agent. That way, the agent knows she/he can trust you and should give you full attention.
Zillow.com has an “Agent Finder” feature on their website but I don’t know if the agents pay to be listed. Their production figures are posted; it could be a place to start.
Let the agent refer you to a mortgage loan officer. Agents and mortgage loan officers work in tandem as a team. Most agents have their favorite loan officers because the loan officers know how to close loans. And, everyone will be thrilled that you have done your homework.
Next week I’m going to share with you some of the special loan programs that are available