Having purchased several homes now, there are some things that I'm realizing come with the home-buying territory. While each home purchase is somewhat different, I've found that there are certain commonalities among our experiences. I carry some of these most valuable characteristics along with me in an effort to make future home purchases easier and hopefully a little less costly as well. Here are some of the crucial elements of home buying that I've begun to realize can place a significant role in the home-buying experience.
The Process Itself can be Costly
There can be plenty of time, money, and frustration involve in finding not only a home, but the right home. Between finding a good real estate agent, looking at homes, getting approved for a loan, negotiating a deal, getting through the home inspection, waiting to move in, and finally moving, there can be a number of hurdles to clear before getting into a home.
To make the process simpler, I tend to make a home-sale checklist of things to be completed and their associated dates. This way I stay on track without missing any critical elements that could add further time and frustration -- not to mention money -- to the home-buying process.
Sometimes it Pays to Think Outside the Box
I think that sometimes buyers get into an "own a home or nothing" type mindset. I think this is what happened with our first home purchase. In the process, we ignored other options and failed to think outside the box when it came to possible home ownership scenarios or options. In the process, we didn't explore condominium ownership closely enough (we own a condo now though), and we failed to consider a rent-to-own possibility that I think would have been great for us as first-time home buyers. We had several such rent-to-own type offers when we decided to sell our home, and I think that this can be a great way to be able to live in and get the feel for a home before committing to buy it.
Closing Costs are Just for Sellers…Not!
While many of the closing costs can be shouldered by sellers, this doesn't mean that buyers won't have costs of their own when it comes to this aspect of transferring home ownership. Things like real estate lawyer fees, mortgage application and processing fees, title company costs, and similar expenses can easily add hundreds or even thousands of dollars to the home buying process.
Mortgage Interest Rates Can Make a Huge Difference
A measly percent or two difference in interest rate might not sound like much at first. But when we're talking that much on payments of a loan of $100,000 or $200,000 dollars spread over 15 or 30 years, it can end up equating to tens of thousands of dollars in extra interest. This is why my wife and I worked our tales off to dump as much equity into our home in an effort to pay it off as quickly as possible, and when we eventually sold, we were able to take that equity and combine it with extra savings to buy a home outright.
Owning a Home is Kind of Like Raising a Child
With the buying of our first home correlating closely with the birth of our first child, I realized that owning a home is kind of like raising a child. There is the time involved in getting to know it, a home often needs a lot of attention, it's expensive, things happen to it when we least expect it, and these are typically not the things we were expecting to happen, and just when we think we've got everything down and we know what we're doing, we're thrown a curve ball of some sort.
Like raising a child, while there are many things that we can do to form how we'd like our home to function and behave, there are some things that are beyond our direct ability to control. Therefore, all we can do is be proactive and stay ready until we have to be reactive.
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The author is not a licensed financial or real estate professional. The information provided in this article is for informational purposes only and does not constitute legal, financial or real estate advice. Any action taken by the reader due to the information provided in this article is solely at the reader's discretion.
- Real Estate