Presumably, all first-time home buyers have heard the advice about speaking to a lender to get pre-approved before you start looking. This is good advice for several reasons:
• It sets your expectations about what you can afford.
• It allows you to move quickly when you find a home you’d like to buy.
• Sellers will require such a letter along with your contract offer.
But here are several other things to keep in mind.
1. In a seller’s market like today’s, there are very few — if any — bargains for buyers.
2. If something sounds too good to be true, it probably is.
3. Similarly, if something looks too good to be true for the price, it probably is. A picture is worth a thousand lies; that’s why God invented wide-angle lenses.
4. However, it’s also a bad sign if there are no pictures in the listing. Or only a picture of the outside — especially if the home has been on the market for a while.
5. If a home has been on the market for more than 90 days, there’s probably something wrong with it, or it’s overpriced.
6. The amount of drama in a real estate transaction increases exponentially as you approach the settlement date.
7. Something will always go wrong the day before settlement.
8. Buying/selling a home is like a simultaneous marriage (for the buyer) and divorce (for the seller). In the same way that you wouldn’t want to use the same lawyer for that, you don’t want to have the same real estate agent try to represent both sides of a transaction.
9. Loan officers get paid to make loans; underwriters get paid to prevent bad loans from being made. Sometime loan officers and underwriters at the same lending company appear to be working at cross purposes.
10. Appraisers and inspectors are just doing their jobs, though it often seems they are working against you. Since you’re paying for them as the buyer, they’re actually working for you to make sure you don’t buy an overpriced lemon.
The most important guideline is this: Keep your sense of humor throughout the home-buying process. It will reduce your stress through one of the most potentially stressful (and largest!) financial transactions of your life. And it will keep you from getting too attached to a property in case it doesn’t work out. As we say in our office when a deal falls through — next!
Ted Smith is a licensed Realtor® with Real Living at Home specializing in mid-city D.C. He can be reached at TedSmithSellsDC@rlathome.com or follow him on Facebook, YouTube or Twitter. He gives monthly tours of mid-city neighborhood open houses, as well as monthly seminars geared toward first-time home buyers. Sign up at meetup.com.