Home Buying Best Practices
The Value of Observing These Home Buying Best Practices
We’ve all heard the term, “buyers remorse”. It’s one thing when you went to the wrong restaurant, purchased a suit that fell apart within the first year, purchased a car that turned out to be a lemon or even accepted a job you later regretted. None of these match the horror of discovering you made a poor home-buying decision!
On the other hand, there’s nothing like the satisfaction of knowing you made a great home-buying decision. This can cover a host of other financial mistakes in life: “At least I’m happy with my property!”
Take a little time to carefully study the following home buying best practices before springing into action. You’ll thank yourself again and again for years to come!
Roadmap for Home Buying Best Practices: 7-Step Home Buying Process
Step 1: Determine how your property will be held.
Home Buying Best Practices Step 1: Determine how your property will be held.
What does this mean?
The title indicates who holds ownership of the property. Who will be on the title? The spouse who has the highest credit rating? Both spouses? You want to decide who will be on the title BEFORE you go into escrow. If you try to change the names on the title WHILE in escrow, it will significantly slow the process down, cause some severe headaches, and you may loose a buying opportunity!
- Tax Managers
- Insurance Brokers
- Single Family Financing Professionals (Mortgage Companies)
- A Paper – For those employed with good credit.
- B Paper – For self-employed and those with credit issues.
- C Paper – Poor Credit
- Commercial Financing Professionals
Step 2: Determine which Real Estate agent you will work with before traveling.
Home Buying Best Practices Step 2: Determine which Real Estate agent you will work with before traveling to Las Vegas to scout properties.
- Listing agents may have a tendency to steer you only to the properties they are listing.
- Most Las Vegas agents are not skilled in helping investors find the best rental properties (have knowledge of rental rates, repair costs).
- Many agents do not have a qualified list of professional referrals targeted to your specific needs (Accountants, Tax Managers, Insurance and Mortgage Brokers).
- Some agents do not give you an up-front idea of fees: Commission, transaction fees, closing costs.
- Research your agent and check references before flying out to Las Vegas!
Learn more here:
Step 3: Line up your financing before looking.
Home Buying Best Practices Step 3: Line up your financing before looking.
Why is this important? Listing agents will NOT EVEN LOOK at your offer unless you can show them proof of funds. Even if you locate the perfect property, by the time you manage to get a lending approval letter or other proof of funds, that property is gone!
Study up on the Following Considerations in Our Home Buyer Financing Tips:
- Should I get a loan or pay cash?
- Isn’t cash king in the foreclosure market?
- Who offers the best lending rates?
- What if my income / credit is dubious?
- How about getting an owner-carry (OWC) property?
- WHAT TO AVOID DURING THE LOAN PROCESS
- Types of Loans
- Additional Financing Tips
Step 4: Arrange to scout for a variety of properties.
Home Buying Best Practices Step 4: Arrange to scout for a variety of properties.
You need to get an idea of what is available before hunting specific properties.
- Why should we go scouting before hunting?
- Where are the good neighborhoods?
- What is the best neighborhood for me?
- Can I make offers on properties that we see?
- How can I prepare for scouting?
- And, additional tips…
Step 5: Go hunting only after you have ammunition.
Home Buying Best Practices Step 5: Go hunting only after you have ammunition.
You can avoid brain damage if you have done your homework.
- Why are properties in Las Vegas so hard to get?
- Why do we have to visit so many properties?
- Do I have to bid over list price to get a property?
- Should I consider short sales?
- Take notes and rate properties as we go along.
- Don’t fall in love with a property.
- If you are a number cruncher and need to spreadsheet this stuff, bring your laptop or tablet.
- There is a major element of luck in getting a property.
- And, additional house hunting tips…
Step 6: Prepare to navigate escrow as gracefully as possible.
Home Buying Best Practices Step 6: Prepare to navigate escrow as gracefully as possible.
What is Escrow? It’s the time period between when the bank accepts your offer and the property is recorded with the county. During this time the title company holds your earnest money deposit and searches any/all liens on the property so that the seller can pay them off.
Learn more about the Las Vegas Escrow and closing process on our page “What Is Escrow?“
- Can I back out of a deal while we are in escrow?
- What are title fees?
- Can I choose the title company?
- How long does escrow last?
- What do we do while we are in escrow?
- Why how you hold title will have a significant impact on the escrow process?
- What does the seller and listing agent process look like?
- What is the hardest decision you will make when the bank accepts your offer.
- What you should NEVER do during the escrow process.
- Important tools to have while in escrow.
- And many additional escrow FAQs and tips.
Step 7: Get your property ready for move in.
Home Buying Best Practices Step 7: Get your property ready for move in.
What property repairs are reasonable and what repairs are an unnecessary expense when getting your Real Estate investment property ready for renters? See the Property Repairs section on our Property Management Best Practices page.