Avoiding the stumbling blocks

Buying a home can be a tremendously gratifying experience. You truly can move into the home of your dreams at a price you can afford and live there worry-free until it’s time to sell it at a profit. However, the procedure is fraught with financial and legal stumbling blocks that can destroy your plans.

Here we present some tips to reduce risk and smooth out the process.

Step One: Check your credit report and score

Your credit report and credit score have a huge impact on your ability to buy a home. Lenders will closely examine:

* Your bill-payment history.
* The amount you owe.
* The length of your credit history.
* The types of credit you have and use.

The cleaner your credit report and the higher your credit score, the better chance you have of obtaining a mortgage loan at low interest. Obtain a copy of your credit report right away. This is freeh

Step Two: Obtain loan pre-approval

It’s wise to apply for a loan before shopping for a home. The goal is to get pre-approved, which enables you to:

* Save time shopping by focusing on homes you know you can afford.
* Avoid disappointment by minimizing financial surprises.
* Increase your bargaining power by proving to the seller that the home is effectively sold.
* Speed up the closing process.

Step Three: Think about hiring a real-estate agent

You can buy a home on your own, but it’s risky. Hiring a good real estate agent can help you reduce stress by:

* Helping you to see the pros and cons of a property and providing information about the neighborhood and comparative sales.
* Alerting you to legal and financial obstacles and helping you avoid them.
* Assisting you in negotiating a fair price. You want to develop a strategy that gets you the property you want at the price you want.

Note: The designation Realtor applies to real estate agents — and the companies they work for — that are members of the National Association of Realtors.

Step Four: Find a good agent.

To find a good real estate agent, do the following:

* Get referrals from friends and colleagues.

* Check references from an agent’s three most recent clients.
* Interview potential agents. Ask

* How long have you been licensed? Look for an agent who has at least five years’ experience.
* How many homes did you sell last year and for what average price?
* How many clients do you have now? A few but not too many is ideal.
* How much do you charge? Cheaper may not be better.
* How will you help me get the home I want? Knowledge of the financing process, mortgage loan options, taxes and insurance and proven tough negotiating skills are going to be extremely important.

Step Five: Don’t shop for what you won’t like

Let your agent know what amenities of a property are important to you. Don’t waste your time looking at homes that don’t offer what you want. Such as

* A beautiful view.
* A big yard.
* Extraordinary landscaping.
* Many bedrooms and bathrooms.
* More than one fireplace.
* A swimming pool.

Step Six: Keep resale value in mind

All those features may seem like must-haves to you at first. But they will not necessarily add to a home’s resale value. In fact, some of them – like a high-maintenance pool – can reduce it. So what features are almost guaranteed to add to resale value? As any agent will tell you, location is key. Proximity to good schools, public transportation and shopping may not be of utmost importance to you, but it could dramatically affect your ability to sell in the future. Beyond location, there are many other factors that determine how attractive your home will be to buyers when the time comes. Here are a few:

* Three to four bedrooms.
* At least two-and-a-half bathrooms.
* Plenty of closet space.
* At least a two-car garage.
* Laundry facilities located conveniently but unobtrusively.
* A large kitchen and modern appliances.
* Easy access to the back yard.
* A fireplace in the family room.

Step Seven: Get the home inspected

The best way to protect yourself from the unknown is to hire an experienced home inspector to examine the home’s roof and general structural integrity, utilities and other systems. The cost ranges from $250 to $500. Get the inspection after you and the seller have agreed on a price but before you have signed the contract and made a deposit.

Closing the deal

After the give-and-take, after the offers and counter-offers, once you (or you and your agent) have made an offer that the buyer accepts, there’s one more step. Make sure that an attorney who specializes in real estate law checks all the paperwork. Mistakes and omissions at this point could ruin the whole deal at the last minute.