If you’re embarking on the joyful journey of buying a home in the coming year, I recommend the first step you take is to prepare a home buyer checklist. Many real estate professionals advise mortgage pre-qualification as the first step if you’re not buying with cash, but ask yourself this question: why am I getting pre-qualified? What’s your goal? Having at least a first draft of your home buyer checklist provides vision and direction for the entire house hunting process. You may find that your financial position easily supports purchase of a home that meets all your needs and mortgage pre-qualification is a snap. You may also find that to afford a home that meets just your minimum requirements could require re-prioritization of your personal spending or more time to pay down debts and save. Pre-qualification amounts are not chiseled in stone, they can be improved so that your home buying needs and your household budget are in harmony. If your borrowing limit is less than what’s needed to buy the home you want, your mortgage lender may be able to recommend actions you can take to increase your qualification limit. But what’s the home you want? The best way to determine that is to prepare a home buyer checklist and review it with your real estate broker. With a vision of your goal in mind, proceed with pre-qualification and your home search.
Here are a few handy tips to help you create a simple home buyer checklist. Refer to the example below when considering each tip.
Tip 1: Write It Down. This may seem elementary, but it’s important to create the checklist in writing so it can be shared with others. If needed, add notes to clarify specifics.
Tip 2: Use Standard Features. Use features commonly found in home listings, especially features identified in the local multiple listing service (MLS). Most brokers create a profile of your desired home in their MLS account so they are alerted immediately when a home that meets your criteria comes on the market. Your broker might also circulate a condensed and confidential version of your checklist among other agents to receive advance notice of new listings before they are published in the MLS or advertised through other channels. Most brokers have an all-encompassing list of basic features to choose from, if you are not offered one – ask for it. Each MLS system has its own standard features, those used in the example above are found in most MLS systems.
Tip 3: Differentiate Between Must verus Desired. These can be some of the most difficult choices associated with creating your checklist. Many agents use only Must features when they search for properties. Having too few Must features on the checklist could lead to touring homes that are unacceptable and having too many could keep home buyers from viewing homes that might interest them. Work with your broker to find a balance that works for the market where you intend to buy.
Tip 4: Don’t List Items That Aren’t Critical. Just as determining between Must and Desired features can influence how many homes make the cut for viewing, adding features that are not critical to your initial decision process can create distractions and waste time. If a home meets almost every Must and most of your Desire features, does it matter if the bathroom sinks have Satin Stainless finishes rather than Satin Nickel? Flexibility on minor features that can be remodeled, changed or added later can increase the number of homes to choose from.
Tip 5: Revise Your Checklist As Needed. House hunting is an educational experience. As we tour homes, we see design and decoration ideas that spark our creativity and provide a better understanding of what features are available within our price range and desired location. As we learn, we should update our checklist.
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