6 Things to Know Before Buying a New Home
Set your expectations
Many buyers prefer purchasing newly built homes. When asked why they want to buy a new construction, most people say it’s because everything is new and in perfect condition.
While most of the brand new things we get work perfectly, it doesn't always happen that way when it comes to homes.
There is no perfect home.
All homes, be it newly constructed ones or previously lived-in, will always have some issues. Don't assume that because a house is brand new, that everything in it will work smoothly.
To avoid getting frustrated because of unforeseen house issues, have your lawyer include a clause in the contract stating that any unidentified issues that surface after closing must be taken cared of by the builder.
To help you better prepare for buying a new home in Waukesha, here are six mistakes you should look out for:
1. Saying "Yes" to a home before securing a pre-approval.
One of the most common mistakes buyers make is shopping for homes before knowing how much they can really afford.
When you start searching for a home and you fall in love with the features of the model house, you fall at the whims of the salesperson who promises to help secure your financing which most likely is all wrong for your budget. This is a bad deal.
Allowing your emotions and desires to rule over your budget capacity will give you major mortgage problems.
Before you go house shopping, go mortgage shopping first. Ask at least three banks or lenders for a pre-qualification, know the best type of mortgage loan for the possible amount you can afford, and then secure a pre-approval.
Getting a pre-approval streamlines the properties available to you. You'll know exactly how much you can afford, which means you don't go over budget.
2. Skipping the good faith estimates (GFE). The GFE is a document that lists all the basic information of the mortgage loan offer. When you initially apply for a mortgage loan, the lender must provide you with the GFE so you get a clear understanding of the real cost of the loan.
Most buyers are happy with one GFE. Give yourself some options and apply at three different lenders, that way you have three GFE’s to compare. This is the best way to find the mortgage lender to turn to.
Don't worry about having three simultaneous mortgages taking place. Lenders cannot proceed with the loan until they give you the GFE and you indicate that you want to continue with the loan.
3. Failing to negotiate terms. Many home buyers are reluctant to negotiate, not want to be too demanding or disagreeable. Negotiating doesn't have to be confrontational, it can be done professionally and efficiently. Also, lenders and builders expect you to negotiate!
4. Not asking neighbors about the builder’s reputation. Another common mistake of new home buyers is not asking the neighbors about their opinion of the builder’s reputation.
It is important to know if the neighbors think the builders are doing their job well, if they’ve followed the timeline, if they’ve heard of any construction problems that happened, etc.
5. Waiving your home inspection. Home inspection is crucial, and just because it’s a new home doesn’t mean it has no problems. The cost of hiring a home inspection is insignificant compared to the possible cost you’ll spend if the home starts having problems.
6. Ignoring the “punch list” before closing. Because constructions are not always done perfectly, there are always items that must be fixed. This is the punch list.
You should be aware of the home’s punch list and ask the builders to complete the list before closing. Many builders try to persuade buyers to close before the punch list is taken care of so they can move on to their next job.
While buying a newly constructed in Waukesha WI home is exciting, don’t get too caught up that you’ll forget about the little details that will eventually affect your lives.
If you’re planning to buy a home anytime in the near future, you need the help of an experienced agent to guide you through the process.
Please visit http://www.KristinJohnston.com/ to see homes for sale in Waukesha and in the surrounding areas.
Call me, Kristin Johnston, at 414-254-6647. Let me help you find the best home for you and your loved ones.
**In case you can not view this video here, please click the link below to view 6 Things to Know Before Buying a New Home on my YouTube channel: https://www.youtube.com/watch?v=v_dmW5XiCXM&feature=youtu.be**