The Mortgage Hunt – Part Three

The hunt for a new home and a new mortgage can be challenging. We’ve already discussed tips for choosing a mortgage lender or broker, and the need for a pre-qualification or pre-approval letter.

In this article, we’ll help you through the process of choosing the right home for you, and working with a realtor, if you choose to do so.

You probably already know what you’ll be looking for in a new home – number of bedrooms and baths, fenced yard, two- or three-car garage, fireplace, full basement, etc. If you have school-age children, you also may already know which school you’d like your children to attend, and can plan your search accordingly. You may want to consider other issues, such as a master suite on the first floor or a laundry room on the second.

Your realtor, if you choose one, will be able to guide you through your options. The Multiple Listing Service, which can be accessed online in most communities, will usually provide you with photos of the interior and exterior of any homes you’d like to visit, and there are search options available to you to narrow your search only to homes that provide the options that you choose, in the area you choose. You’ll also have the option of narrowing your search to within a certain price range, since you’ll already have your pre-qualification or pre-approval letter, and know exactly how much you qualify for.

Realtors may now represent buyers as well as sellers, and you may want to choose a realtor who works only, or primarily, with buyers. As with choosing a mortgage lender or broker, we encourage you to interview several realtors, and ask how familiar the realtor is with the area in which you’ll be looking, the area’s school system, the property tax rate, and any other questions you may have. Does the realtor work full-time, or only part-time? Will he or she be available to show you homes during the hours and days that you prefer to look?

Most realtors will ask you to sign a Buyer Agency agreement, which states that you are choosing this specific realtor, and that he or she is entitled to a commission on any home you purchase. The seller still traditionally pays the entire real estate commission, but make sure you’re aware of the terms of the Buyer Agency agreement before you sign it. The agreement will remain in force for a specific period of time, and any house you view during that time that you ultimately purchase will entitle your realtor to a commission, in most cases.

What if you’re not satisfied with your realtor once you choose one? Most realty companies will release you from your contract if you’re unhappy with your realtor, but obtain this information in writing if it is not already contained in the agreement.

If you already own a home that you’ll need to sell before you buy a new one, consider your options carefully. Many a buyer has fallen in love with a new home, made an offer on it, and had the offer accepted by the seller, only to have the deal fall through because the buyer’s current home doesn’t sell within the time frame of the contract on the new house. To avoid this problem, many buyers are selling their current homes before even looking for a new home. This may necessitate a short stay in an apartment or with family after your current home sells, but it may be worth it to you.

Other buyers simply take their chances, preferring not to make two moves. In either case, if you know you must sell your current home before you’re able to buy a new one, talk to your realtor about your situation before you make an offer on a home.

After you view the homes on your list and narrow them down, go back to each of the homes during various times of the day and night to get a feel for the noise and traffic in each area before making your decision.

Preparing yourself for each step along the way can help you avoid many of the headaches that other buyers suffer.

Published November 19, 2007