Scottsdale Home Buying Tips

Your Scottsdale home buying dream is within reach. You've found a home you really like, but suddenly something's just not right. What do you do? That depends, of course, on what the issue is – and just how badly you want the home. Here are five potential problems worth thinking about before you make a mistake.

Scottsdale Home Buying: When to Walk Away

Your Scottsdale home buying dream is close, but the home appraisal is below the asking price. Now what?

The real estate appraisal is lower than the sales price.
In a seller's market, it's not uncommon for a home's appraisal to come in below the contract price. When that happens you have several options. 1) The buyer has to come up with additional money to make up the difference between what the bank will lend and the sales price. 2) The buyer can attempt to negotiate the sales price down.  3) The buyer can opt to seek a mortgage from another lender in the hopes that another appraisal will be higher. If you can't make any of these options work, and the seller isn't open to negotiate, it may be time to walk away. Why pay more for a house than what it's worth?

The home inspection reveals too many shortcomings.
Most buyers don't have the time, patience or knowledge to complete a laundry list of repairs needed to be made on a house they want to buy. While some people aren't turned off by fixer-uppers, depending on what issues the home inspector uncovers, you could find yourself spending more time and money than you had planned. If you like the idea of moving in with few repairs or replacements, shortcomings found in a home inspection may mean it's time to keep on looking.

You start second-guessing compromises you made.
When you start the Scottsdale home buying search you have a list of features in your head that you're looking for. Ultimately price determines how it all shakes out. Often you find yourself making compromises – electing to do without some things or settle for less on others. Here's an important rule of thumb to consider: If you second-guess yourself and try to justify crossing things off your list that you had your heart set on, it's time to reevaluate. Trust your feelings.

You're at the limit of your original price range.
Let's say you begin your home search at the top end of your intended price range. If it's a seller's market with little available inventory or if you find a house on which there will be multiple offers, you may be tempted to push yourself over the limit. Later, you may have wished you'd left yourself and your family a little more breathing room. You set limits for a reason. If you're concerned about the payments, the additional cash outlay or depleting reserves designed for repairs, new furniture or emergencies, you may regret your decision.

If you purchase a home with another person and you don't see eye to eye.
Nothing strains a relationship – personal or business – like spending money when both parties aren't on the same page. Here's an important Scottsdale home buying tip: Before you start the process, discuss what you both want and expect. Anticipate problems and try come up with solutions before they occur. It will make them seem less imposing when and if the time comes. Make a pact that if either of you are uncomfortable, you'll walk away and keep looking – for a house, not a new partner!

If you can't sleep.
It's normal to be a little anxious about the largest purchase most of us will ever make. But if it constantly nags at you or if you're obsessed with making the wrong decision, it could be time to find peace of mind – and walk away from the deal. Life's too short for regret. Don't enter into any purchase you can't relax and smile about.

See more articles pertaining to Scottsdale home buying in the Scottsdale Home Buying Tips section of our site below Scottsdale Real Estate Categories in the column to your right.

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Scottsdale home buying is competitive. Jockeying for position has some purchasers using a bold new tactic: personal letters sent to the seller of the home they want. Let's look at why this phenomenon exists –- and whether it's right for you.

Scottsdale Home Buying Becomes Personal

Scottsdale home buying is competitive. Jockeying for position has prospective purchasers writing personal letters to the sellers.

Most real estate agents agree it's rare today for buyers and sellers to meet during the home buying process. We live in a society of texting, emailing and shrinking personal engagement. However, when a seller receives a heartfelt, impassionate letter from a buyer it "humanizes" that person in the seller's eyes. Such a letter is often accompanied by the ages of their children – even a family photo. It's all designed to tug at the seller's heartstrings in the hope their offer will be accepted over others vying for the same house.

Agents say while these efforts don't always work, there are some sellers who are swayed. Home sellers form a strong emotional bond to their homes and like the idea of selling to someone that will feel the same way. Sellers who've raised a family in the home have a strong sense of attachment and can be influenced by a buyer who also has a family.

However, some home sellers make decisions purely on financial or economic reasons. They're the ones looking for the highest offer, the greatest likelihood of credit approval and quickest loan closing. Still, agents say, every seller is different. Sellers sometimes make decisions not based on financial issues but emotional reasons. Some sellers actually accept a lower offer and turn down a fast closing date because they identified with their buyer.

In today's Scottsdale home buying market, usually the two most important factors to consider are price and terms. If a home buyer can't make those two items pleasing to the seller, a deal probably won't get made, and an emotional appeal will have little bearing. There are exceptions, though, and some agents cite cases where a seller rejected a higher offer from an investor who planned to rent the property in favor of a family who planned to live there.

Consider the following as to whether the letter-writing tactic may work for you.

Can you offer a price that will get the seller's attention? If so, your family may have an advantage if you can convince the seller that you will be "faithful stewards" of their home.

Will the terms work for the seller? The loan closing date, any contingencies or other parts of the contract may matter to the seller as much as the sales price. Have you met that criteria? If not, then the emotional aspect of the deal may not mean as much as you hope.

Have you done everything you can to convince the seller that you have every intention of closing the deal? Get pre-approved for a mortgage and make sure you have all the necessary down payment and closing costs available.

Are you making a large enough down payment? In the seller's eyes it's an indication of the buyer's financial strength. A small down payment may be worrisome and may lead to other questions about whether to accept your offer.

Are you prepared for any potential surprises a home inspection may reveal? If there are issues important enough to restart negotiations, the seller may want to find out how emotionally interested you are in order to reach a agreeable solution if there's a problem.

Tread lightly if you really want the home. Remember the market is competitive. That's why you considered writing an emotional appeal in the first place. The seller probably has back-up contracts – or at least options to consider – if you hesitate or fail to meet your end of the deal.

For more Scottsdale home buying tips, check out our other articles in the Home Buying section to your right just below Scottsdale Real Estate Categories. And be sure to look us up on Twitter and Facebook.

Before you enter the Scottsdale home buying market, there are three important pieces of the puzzle you should understand. What do you know about closing costs? How about your credit score? What you know will help you make the best decisions once you find the home you're ready to buy.

Before you enter the Scottsdale home buying market, there are three important things you should understand...

Scottsdale Home Buying: What to Know

Tip #1.
Find out how much your closing costs will be. Often prospective buyers are shocked when they find out how much closing costs can be. Knowing in advance an estimate of your closing costs will help you plan better for how much of a down payment and other costs you will be expected to pay.

Most closing costs average between 2%-5% of the mortgage loan amount and cover items such as mortgage fees, appraisal charges, attorney’s fees and home inspections.

If the total amount exceeds what you have available or what you’re comfortable in paying, there are alternatives. One, as we’ll touch on in Scottsdale home buying Tip #2, is to negotiate with the home seller on payment of the closing costs. Another popular alternative is a low down payment loan program that requires as little as 3% down on approved home purchases. In addition, Fannie Mae recently rolled out a mending program designed to assist first-time home buyers. Qualifying purchasers are able to receive up to 3% of the home’s purchase price in closing cost assistance.

Tip #2.
Know which party is responsible for paying closing costs. There is also a fair degree of confusion as to who is usually responsible for paying certain closing costs at the settlement. As mentioned above, often home sellers will agree to pay some or all closing costs as an incentive to prospective purchasers.

Tip #3.
Know the value of your credit score. A popular television commercial depicts the feeling of empowerment a consumer has when they know and understand their credit score. A high credit score gives you a better chance at a lower interest rate when it comes time to take out a mortgage. In addition, your credit score may also affect other credit decisions regarding your home purchase such as the amount of utility deposit you may be required to pay, and even your home owners insurance premium.

There is currently some discussions in the home buying industry that some lenders are considering pulling away from FICO scores. However, it’s safe to assume that until it is known what will replace the FICO score, most lenders will base their credit decisions on the payment history of the debts you owe.

Following these important Scottsdale home buying tips will make your home search more enjoyable and more fruitful — since you’ll be more confident and informed about what is expected of you in the home buying process.

For more Scottsdale  home buying tips see our Scottsdale Homebuying Tips articles to your right just below Scottsdale Real Estate Categories. Don't forget to find us on Facebook and Twitter, too.

Scottsdale home buying just got a little easier, thanks to home buyer education classes. For those receiving down payment assistance, a home buyer education course may be a requirement. Mortgage lenders may also require the course. The classes can be very informative for anyone thinking of buying a home.

Take a Scottsdale Home Buying Course

Scottsdale home buying just got easier thanks to home buyer education classes.

While some home buyer education classes charge a fee, some are free. They are often available online. A certificate from a HUD-approved agency is needed for lenders requiring classes for borrowers.

The course provides beneficial information about the home buying and mortgage process. Subjects include personal budgeting, credit scores, finding the best mortgages, homeowners insurance, home inspections and how to select and work with a real estate agent.

A recent survey of 1,000 people revealed nearly 75% of consumers think the home buying process is complicated. Recent mortgage disclosure requirements have made it even more confusing.

Experts suggest buyers enroll in the class as soon as they decide to enter the Scottsdale home buying market. Do that, they say, before you select a home or a lender. The class will teach you how to shop for both.

The course can be very important to prospects with credit problems or with little or no credit. Anticipating the questions a lender may ask will empower you and better prepare you.

A first-time home buyers course will help with the following topics:

How does a credit score work? Lenders use credit scores to determine if you qualify for a loan and, if so, what the terms will be. You should know your credit score before taking the class.

Why is a home inspection needed? While most lenders don’t require a home inspection, it’s a good idea to have one to be safe. It will let you know about any needed repairs the home may have. Knowing that up front gives the buyer information that can be used in negotiating the sales price.

How to choose and work with a real estate agent? Since real estate commissions are normally paid by the seller, there is no cost for a home buyer to select and work with a real estate professional. Establish a relationship with the agent you choose and make sure he or she understands what you’re looking for in a home.

How can I save water and electricity in my new home? Because your monthly mortgage payment is just a portion of the cost of home ownership, it’s important to know how to budget for the other costs. Water, heating and cooling, trash collection and other fees will increase monthly expenses. A home owner class can provide money-saving tips.

What costs can I expect when I get ready to close the loan? In addition to the down payment you’ll have to make, you’ll also have to pay closing costs. Items like title insurance, appraisal fees, real estate taxes, homeowners insurance and other costs are your responsibility at the loan closing — unless you’ve negotiated with the home seller to pay some or all of them.

How do I shop for the best mortgage? Mortgage lending programs vary among lenders. Interview several lenders to find out what they offer and what best fits your needs. Then you can provide your financial information for them to perform the underwriting to make sure you qualify.

How do I obtain ownership with another person? Real estate titling varies by state. How the title is set up will determine, for example, whether the co-owner’s interest will transfer to you upon their death, or be left to surviving relatives.

Where can I find assistance with a down payment? There are programs available in some cities that offer grants or loans for down payments for first-time buyers. The class may assist in helping you find those programs as you enter the Scottsdale home buying arena.

Get more Scottsdale home buying tips by finding our Scottsdale Homebuying Tips articles to your right just below Scottsdale Real Estate Categories. Don't forget to find us on Facebook and Twitter as well.

Once you decide to enter the Scottsdale home buying market you'll be faced with a number of decisions. None will be more important than the choices you make when it comes to finding a lender and a real estate agent. These and other professionals will make the home buying process more efficient and, ultimately, more enjoyable. So, what should you look for in the pros you need?

Your Scottsdale Home Buying Team

Success is a team effort. And choosing the right team can be critical in the home buying process. First, you'll need a mortgage lending professional. In today's market, it's a good idea to get pre-approved for a loan before you spend time searching for a home to buy.

Pre-approval will help you determine the amount you can borrow and the price range of the home you can buy. Interview several mortgage lenders. Find out how much experience they have. How long have they been in the mortgage business? What are their areas of specialty? How familiar are they with the various lending programs available –– especially for first-time buyers or for buyers with small down payments.

Next, begin the process of hiring a real estate agent. Again, meet with several and interview them. Discuss your needs and desires, and find out their level of knowledge and experience in the marketplace or neighborhoods you're interested in. Ask for references and contact them. Check their reviews on various real estate affiliated websites. Lastly, choose the agent with whom you feel most comfortable. The right combination of experience, knowledge, commitment and personal involvement should be your ultimate goal for this key teammate.

 

Remember, these two team members are here to help, and they work for you. So ask questions if you don't understand something. You'll feel greater confidence as you become more knowledgeable and more familiar with the Scottsdale home buying process.