Buying a Home….Got Questions?
Buying a home is a major purchase in anyone’s life, and as with any major purchase, buyers have questions. It is all a normal part of the process. Whether a buyer has just a few questions or several, the best course is for them to turn to their Realtor for a well-informed, educated answer. Below is a small sample of some common questions that many real estate agents say they receive from buyers.
- What does it cost me to hire you to help me purchase a home?
This is an excellent question. The answer is nothing. It is common practice for the sellers to incur the cost of real estate commissions, paying both the listing and selling agent at closing. With that being said, some brokerage firms may charge a transaction fee to the buyer at closing, while others charge nothing. This is just a detail that a buyer would follow up on with their agent.
- Why do I need to secure a loan pre-approval before looking at homes?
Obtaining a loan pre-approval is very important before even walking into a buyer’s first showing for a couple of reasons. First, this gives the buyers and their Realtor an accurate idea of what is going to be affordable for them. It helps for the Realtor to be able to set up appropriate showings. It can be a waste of time to start looking before the pre-approval is received, as the buyer may be looking at homes that are well outside what they can afford. Second, when it comes time to make an offer, it is usually required for the buyer to provide a letter of pre-approval from their lender for their offer to even be considered.
- What is a normal amount to put down for escrow?
It is important to understand that what may be normal for one area of town to place in escrow could be drastically different in another. The size and price of the home will also affect how much escrow will need to be put down. This is a perfect example of why it is important to have a Realtor working for you, guiding you and helping you along the buying process. They will be informed about the home and community that you are looking to purchase in, and can give their buyer a competitive amount to place down. When deciding on an escrow amount, a buyer wants to demonstrate to the seller that they are serious about their offer by placing enough funds in escrow to show the seller that they are committed to the deal.
- Can we negotiate after inspection if there is a lot of items to be fixed?
The short answer is yes, however there may be times when a seller will not negotiate any off the original terms, but more times than not both parties are up for renegotiation. When an inspection report shows that several more problems/issues exist than what was initially suspected, a buyer may want to ask for some repairs and/or funds at closing to be applied to said repairs. In today’s market, the majority of contracts include a due diligence period, and there are times while the buyer is still in this time frame that they want to readdress the original terms. This is an example of why it is important to get your inspection done early so there is plenty of time to renegotiate, if necessary.
- What is the neighborhood resale?
Many times when buyers are looking to place an offer on a home they want to know their potential for a return on their investment. Certainly, a very solid question, and another great question to present to one’s Realtor. A buyer’s agent would be educated about the neighborhood and community and while they wouldn’t be able to make any guarantees about the future market, they would certainly be able to show them a current snapshot of the real estate market; as well as the market trends for that neighborhood over the last year.
It is normal and smart to ask questions when making any major purchase, especially a new home, as chances are you will be living there for many years. It is smart to be well informed about the buying process as well. Realtors want their clients to feel comfortable and to be at ease. Don’t be shy, ask those questions.