Purchasing a home is usually one of the largest purchases individuals make during their lifetimes. Special care and consideration should be given to choosing any home – but especially a first home. It is likely that your first home will not be your forever home and therefore, when you eventually go to sell that first home, you want to make sure that you have set yourself up for success.
Consider how easy it would be to sell the home
The last thing on a first-time buyer’s mind is the sale of the home they are about to buy; however, this is a crucial consideration if you ever want to step up in the home-buying game. It is likely that the proceeds from the sale of your first home will be used to purchase your second home, and that your second home may contain a few more bedrooms, an extra bathroom, or other features that were not in the budget at the time of your first home purchase.
To ensure that you can reap enough of a profit to make the step up to a bigger and better second home, you should be paying attention to the market and considering whether your home will eventually sell for more than you purchased it for. To help keep your home value up, you should make sure that you allocate money from your yearly budget to keep up with the maintenance of the home. Part of this allocation should be for an emergency fund in the event that an expensive and unexpected repair arises. Other things to consider are the desirability of the location, its related school district, distance to shopping, how well the surrounding homes are maintained, etc.
Ask for a home inspection contingency
A great way to reduce your risk of inheriting an expensive repair with a home is to make your offer contingent on an inspection. If possible, try to attend your home inspection and ask the inspector questions – if the inspector notices something that needs to be repaired, they may be able to give you a rough fee estimate and other insightful information.
Know how this contingency works. To ensure you know your rights when it comes to a home inspection, you should hire a lawyer. A lawyer can advocate for your interests if the inspection report either makes you no longer want to purchase the property or makes you only want to purchase subject to certain conditions and repairs. A lawyer can also help you understand the type of inspections you may have, how many, when, and other deadlines that need to be met to preserve your rights under an inspection contingency.
Shop around for your mortgage
If you are financing your home with a mortgage, you should shop around or consider using a mortgage broker, who can shop around for you. Lenders will offer different interest rates, and the best way to ensure you are receiving the lowest rate is to call around or use a broker. You do not have to begin the underwriting process with each lender to obtain a rate estimate, rather you can call around and ask hypothetical questions such as what your rate would be with your current credit score, the amount you anticipate putting down, and by providing your debt-to-income ratio.
Understand your title insurance policy
A title insurance policy not only protects you against some issues that may later arise with ownership of the home, but also provides insight into any judgements, liens, mortgages, restrictions, and/or covenants that may encumber the property. Understanding these documents is important for a variety of reasons, but especially if you plan on building an addition, constructing a pool, a shed, or making any other significant property modification that requires a permit or understanding association rules if the property is in a subdivision.
It is not uncommon for unexpected things to show up on a title policy, which is why hiring an attorney to explain the title policy and review other title work, including your final closing statement, is a good idea.
Consider what each party has to gain from a transaction
Nearly every party you encounter who assists with the purchase of your home has an interest in ensuring that the sale goes through – your loan officer only receives their cut if the loan is approved, an agent only receives their commission if the home closes, and even the title company only makes out on their title fees if the sale is successful. The only party who does not have an interest in the sale going through is an attorney, as attorneys are not paid based on a successful closing, and an attorney’s only focus is to help you, whether that is to help you buy the property or help you in getting out of the purchase.
The excitement of purchasing a home can be overwhelming and emotional, which is why it is crucial to approach the process with a clear head. A disinterested party, such as a real estate attorney, can help you navigate the legal aspects of the home-buying process, avoid potential pitfalls, negotiate effectively, and ensure a smooth closing. Contact our attorneys at Wynn at Law, LLC for assistance with the purchase of your home – we can help you navigate the entire process from start to finish, whether you are represented by an agent or not.
Schedule a consultation with Wynn at Law, LLC today to discuss the home buying process
Contact Wynn at Law, LLC today for a consultation at 262-725-0175 or visit our website’s contact page. Wynn at Law, LLC is based in Southern Wisconsin and has offices conveniently located in Salem, Delavan, and Lake Geneva, Wisconsin.
