5 Secrets to Buying the Best House for Your
1. Get "Pre-Approved" - Not
Do you want to get the best property you can
for the least amount of money? Then make sure
you are in the strongest negotiating position
possible. Price is only one element in the
negotiations, and not necessarily the most
important one. Often other terms, such as the
strength of the buyer or the length of escrow,
are critical to a seller.
In years past, I always recommended that
buyers get "pre-qualified" by a lender. This
means that you spend a few minutes on the phone
with a lender who asks you a few questions.
Based on the answers, the lender pronounces you
"pre-qualified" and issues a certificate that
you can show to a seller. Sellers are aware that
such certificates are WORTHLESS, and here's why!
None of the information has been verified!
Many times unknown problems can come to the
surface! Some of the problems I've seen include
recorded judgments, alimony payments due,
glitches on the credit report due to any number
of reasons both accurately and inaccurately,
down payments that have not been in the clients'
bank account long enough, etc.
So the way to make the strongest offer today
is to get "pre-approved". This happens AFTER all
information has been checked and verified. You
are actually APPROVED for the loan and the only
loose end is the appraisal on the property. This
process takes anywhere from a few days to a few
weeks depending on your situation. It's VERY
POWERFUL and a weapon I recommend all my clients
have in their negotiating arsenal.
2. Sell Your Property First, Then Buy the
If you have a house to sell, sell it before
selecting a house to buy! Contingency sales
aren't nearly as strong as one that comes in
with a ready, willing and able buyer. Consider
this scenario: You've found the perfect house -
now you have to go make an offer to the seller.
You want the seller to reduce the price and wait
until you sell your house. The seller figures
that this is a risky deal, since he might pass
up a buyer who DOESN'T have to sell a house
while he's waiting for you. So he says OK, he'll
do the contingency but it has to be a full price
offer! You have now paid more for the house than
you could have because of the contingency, and
you have to sell your existing house in a hurry!
Otherwise you lose the house! So to sell quickly
you might take an offer that's lower than if you
had more time. The bottom line is that buying
before selling might cost you THOUSANDS of
If you're concerned that there is not a house
on the market for you, then go on a
window-shopping trip. You can identify possible
houses and locations without falling in love
with a specific house. If you feel confident
after that then put your house on the market.
Another tactic is to make the sale ''subject
to seller finding suitable housing''. Adding
this phrase to the listing means that WHEN YOU
DO FIND A BUYER, you will have some time to find
the new place. If you don't find anything to
your liking, you don't have to sell your present
3. Play the Game of Nines
Before house hunting, make a list of things
you want in the new place. Then make a list of
the things you don't want. You can use this list
as a guide to rate each property that you see.
The one with the biggest score wins! This helps
avoid confusion and keeps things in perspective
when you're comparing dozens of homes.
When house hunting, keep in mind the
difference between ''STYLE AND SUBSTANCE''. The
SUBSTANCE are things that cannot be changed such
as the location, view, size of lot, noise in the
area, school district, and floor plan. The STYLE
represents easily changed surface finishes like
carpet, wallpaper, color, and window coverings.
Buy the house with good SUBSTANCE, because the
STYLE can always be changed to match your
tastes. I always recommend that you imagine each
house as if it were vacant.
Consider each house on its underlying merits,
not the seller's decorating skills.
4. Don't Be Pushed Into Any House
Your agent should show you everything
available that meets your requirements. Don't
make a decision on a house until you feel that
you've seen enough to pick the best one.
A decade ago, homes were selling quickly,
usually a few days after listing. In that kind
of market, agents advised their clients to make
an offer ON THE SPOT if they liked the house.
That was good advice at the time. Today there
isn't always this urgency, unless a home is
drastically underpriced, and you'll know if it
Don't forget to check into the SCHOOL
DISTRICTS of the area you're considering.
Information is available on every school; such
as class sizes, % of students that go on to
college, SAT scores, etc. You can get this
information from this web site.
5. Stop Calling Ads!
Please note - ads are sometimes created to
make the phone ring! Many of the homes have some
drawback that's not mentioned in the ad, such as
traffic noise, power lines, or litigation in the
community. What's not mentioned in the ad is
usually more important than what is.
For this reason, I want you to be very
careful when reading ads. Remember that the
person writing the ad is representing the seller
and not you! The most important thing you can do
is have someone on your side looking out for
your best interests. Your own agent will
critique the property with an eye towards how
well it meets your needs and will point out any
drawbacks you should know about. So whether you
decide to work with me or not, pick an agent you
feel comfortable with and enlist the services of
that agent as a buyer's broker. Then you become
a client with all the rights, benefits, and
privileges created by this agency relationship,
and you're no longer just a shopper. Did you
know that many homes are sold WITHOUT A SIGN
ever going up or an AD EVER BEING PUT IN THE
PAPER? These "great deals" go to those people
who are committed to working with one agent.
When an agent hears of a great buy, who do you
think he's going to call? His client, who he has
a legal obligation to work hard for you, or
someone who just called on the phone and said
"keep your eyes open"? So to get the best buy on
a property, I always recommend that you hire
your own agent and stick with him or her.