How-to guide on buying a home

July 27, 2015

How-to guide on buying a home

You may buy or sell a home for several reasons: your job requires a transfer, you anticipate a growing family or an empty nest, or you've found the home of your dreams.  Regardless of the reason, it does not have to be a stressful experience. Here are some things to consider when buying a home.

How-to guide on buying a home

1. The offer

If you still like what you see following a thorough assessment of the home and it's location, it is now time to have your real estate agent or attorney make a written offer to purchase. The more houses you've toured and the more comps you've studied, the more secure you'll be about knowing what to offer. You can assume that the sellers have built some room for negotiating into the price and that they'll likely propose a counteroffer to yours. How far apart the numbers are will depend on the market, how long this home has been for sale and whether the price has already been reduced. It helps to know about the sellers' situation. If they have already purchased another home, for example, you probably have a bit more leverage.

Make concessions that will appeal to the sellers. If they are building a house that is not finished yet, they might like a chance to rent the house from you while you save a few dollars by staying in your apartment. Your offer may be accompanied by a good-faith deposit. The money will actually be held by a third party, such as an attorney company, until the sale is completed or cancelled. If the sale is completed, the money will be part of the cash down payment. The offer should include all terms and conditions of your purchase, including inspections.

2. Hiring a real estate inspector

A real estate inspector is a professional who will examine the property and make a report about its condition, including structural soundness, compliance with local housing codes and the condition and age of working systems. An inspector can also assess the presence of pests, such as termites, and environmental hazards, such as radon or asbestos. Sellers sometimes hire inspectors before putting their homes up for sale, and many provinces require sellers to disclose problems with their homes up-front or face legal action later. It is a good idea to ask the sellers if they have filled out a disclosure statement or if they have an inspection report for you to read.

To find a good inspector, ask your friends and real estate agent for recommendations. You'll want to hire an engineer, an architect or a contractor who is bonded, licensed and insured, and who belongs to a home-inspection trade organization. Some inspectors will offer estimated costs for replacing or repairing defects in the home, so be sure to ask if such estimates are included in the fee. Ask how the inspector will present results to you, too; it is usual to have a meeting face-to-face plus a written report of the findings. An inspection contingency in your purchase offer may require the seller to make repairs within a certain amount of time, or allow you to cancel the deal if an inspector finds problems.

Often, the two parties will collect estimates for repairs and work out concessions, such as cash credits. When all terms and conditions of the purchase agreement have been met, you can proceed with the details of the closing. You may do a final walk-through inspection just before closing to make sure repairs have been made and that the house is in the same condition as before negotiations began.

Buying or selling a home is an exciting time and can be handled with ease with a good understanding of the process.

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