by Susan Paige
Millennials are the largest group of homebuyers this year. They make up 37% of all homebuyers.
No matter what generation you belong to, buying a home can be complex with lots of moving parts. Here are 7 real estate questions you should know the answers to before you start house shopping.
1. When Should I get Pre-Approved for a Mortgage?
Some eager homebuyers find their dream home and then turn their attention to getting pre-approval.
Unfortunately, most sellers don’t want to do business with people who don’t have their financing in order. This can cause people to lose out on the property.
So before you start looking at real estate listings online and in person, contact your local experienced mortgage brokers to get pre-approved.
That way you know exactly how much home you can afford. You’ll be ready to put in an offer as soon as you find the right property.
2. Do I Need a Real Estate Agent?
It is possible to buy and sell a home without a real estate agent. This is called For Sale by Owner. But that means you will be responsible for all the work including showings as well as the paperwork.
On the other hand, working with a realtor can be beneficial. Your agent will be able to answer questions about real estate, share their knowledge and advice and handle negotiations.
Knowing how to choose a real estate agent is mainly about finding someone you can trust and who you get along with.
3. Can I Back Out of a Deal if I Change my Mind?
You see a home and fall in love with it. It’s a hot market and you have FOMO so you put in an offer. Then, it’s accepted by the sellers.
But now you have second thoughts. Maybe it will be a lot of work to do those needed renovations. Or maybe it’s not in the right location for you.
The good news is that as buyers you are legally able to back out of a home purchase. However, you will likely lose your deposit.
There are exceptions where you may not lose your deposit if you meet the conditions in the contract. For example, if your offer includes a mortgage contingency then that allows you time to secure financing to buy the home.
If you don’t get the money, you may back out of the deal without losing your deposit if your deal has this contingency.
Make sure you pay careful attention to the wording in the contract.
4. Who is Responsible for Home Repairs After the Purchase?
Moving into your new home can be stressful. And it’s particularly frustrating if you find that fixtures such as the stove, HVAC system or water heater don’t work.
You, the purchaser, must figure out who is responsible to repair for these items. Start by reviewing your purchase contract. This will include all of the seller’s obligations as well as all known problems with the home.
Failing to disclose known problems is called concealment and is a type of fraud. If you can prove the seller knew of these issues, the seller is responsible for their repair.
5. Should I Get a Home Inspection?
Some mortgage loans such as FHA or VA loans make a home inspection a requirement of the loan. But even if your mortgage doesn’t require one, you should always pay for a home inspection. Even if the house is a brand new build.
Home inspections can reveal home defects that you might not otherwise find out about.
Most home inspectors allow you to walk around your new home while they conduct the inspection. This is a great way to become familiar with all the features of your home. You will also learn about what to look for in future such as foundation cracks, moisture near your furnace and so on.
The home inspector will give you a thorough report of your home that indicates what needs immediate attention and what things to keep an eye on. This document is a handy tool that will help you avoid expensive un-planned repairs and damage down the line.
A home inspection will give you great information and peace of mind about your new home.
6. Do I Need to do a Final Walkthrough?
A final walkthrough is your right as the homebuyer. You don’t have to do it if you choose, but it’s a good idea to take the chance.
Your final walkthrough will take place no more than seven days before you close on the new house. Usually, it’s just a few days before closing.
This walkthrough gives you a chance to make sure nothing has changed since you first saw the house and put in an offer.
Look to make sure that the light fixtures, door handles, and curtains haven’t changed to less expensive versions. Make sure the fridge and laundry machines are the same ones that were there when you first saw the house.
The carpets and floorings and walls should be in good condition. If anything has changed or you find anything wrong, you are allowed to request that the seller fixes them.
Sometimes, repairs are written as part of the offer. The final walkthrough is your chance to make sure that those repairs were made and were done right.
If anything is amiss, you will get a chance to do another final walk-through before you close.
7. How Much Money Will I Need for Closing Costs?
This is one of those real estate questions that people should ask well before putting in an offer. It’s important that you budget for this to avoid a negative financial situation.
You can expect to need 3-4% of the home’s purchase price for closing costs. Closing costs include things like lawyer fees, land transfer taxes, and property taxes among other things.
If you buy a home that costs $500,00, you will need between $15,000 and $20,000 for closing costs.
Bottom Line on Real Estate Questions
Thanks for reading! We hope this list of 7 real estate questions has helped you get a better understanding of home buying.
A home purchase is likely the biggest purchase you’ll make so it’s important to become educated on everything involved.
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