“Why Most Home Buyers Lose Thousands Of Dollars
When Finding, Buying And
Financing Their Home…”
It’s true. Even savvy home buyers lose
thousands of dollars…even tens of thousands of dollars they could have
“pocketed” had they known about the important “secrets” that make up a
successful purchase of a great home.
They don’t lose money because someone took
advantage of them. And they don’t lose money because of the economy. The
problem is…
“Most People Don’t Plan To Fail…But Fail To
Plan.”
If you’re in the market to buy a home
anytime soon, and you want to find the perfect home at the best possible
price, terms, and financing, there are THREE things you need to do up
front:
First, understand and get control of your
personal emotions about the purchase of your home Second, get the most
valuable, important information available so you make a prudent and educated
decision. And third, become informed about the very best financial
resources and products to fit YOUR needs…NOW, not later.
After all, buying your home is very
different from any other financial transaction. It isn’t just a “home,”
it’s a transaction that affects your monthly overhead expenses…your ultimate
net worth…your retirement…your kids education…and much more.
So it’s no surprise that buying your home
may involve a bit of fear, anxiety, frustration…or even excitement for that
next move in your life.
The secret is…try not to let these emotions
get in the way of a prudent purchase. The tips and information in this
report will help you have a better understanding of most, if not all,
aspects involved with the purchase of your next home.
So, let’s examine some of the critical
questions you might have with your next home purchase…
1. What is an “as is” sale?
An “as is” property is sold without a warranty as
to condition, repairs, or structure. With an “as is” sale, the buyer is on
notice that the seller makes no promises regarding the property’s physical
status. With an “as is” sale, it is extremely difficult to make a claim
against a seller if something is found to be wrong with the property after
closing. “As is” clauses should be seen as an absolute requirement to make
the transaction contingent on a professional inspection “satisfactory” to
you. With a properly written sale agreement contingency, if you are not
satisfied, then the deal is dead and you can get back your deposit in full.
2. How long must I live in a house once I
buy?
When you apply for a loan, a lender will ask if
you intend to use the property as a prime residence. If the answer is
“yes,” then it is expected that you will physically move into the property
and live there for some time. There does not seem to be a set definition in
the term “some time,” but what lenders are getting at is this: They do not
want to make residential loans with low rates and little down to investors.
Thus, if someone gets a residential mortgage,
instantly moves out, and quickly rents the place, lenders will be more than
unhappy - they may call the loan. They may also review the loan application
to see if fraud was involved. Lenders do not want borrowers to move in and
then rapidly move out, but they will look at the “facts and circumstances”
if such an event occurs. For instance, a sudden job change not known in
advance might be a valid reason for a move after several months of
occupancy. What lenders do not want are situations where a “residential”
borrower is actually a disguised investor. Given that most homes are
occupied for 8-10 years, a move after several months or a year is likely to
set off bells.
3. Can I buy real estate with no money
down?
Yes. Millions of people have bought real estate
with no money down through the VA loan program along with other “not so
legitimate” situations.
If you mean, can you buy real estate at a discount
of 20% or 25% with no cash or credit, and then instantly sell or rent the
place at a profit, then the answer is probably not. Why “probably” instead
of “absolutely” not? Because in a marketplace with millions of transactions
each year, somebody somewhere has made a deal with no money down and rented
or sold at a profit. But it is also true that somebody somewhere was hit by
lightening. The problem is that the term “no money down” is sometimes in
the worst cases a code expression for a deal where someone without cash or
credit wishes to buy property from someone who is needy, unsophisticated,
desperate, in mourning, etc. Under the guise of “helping” the owner, buyers
offer to purchase property at 20% off, or more, and with subordination and
substitution clauses. Of course, if purchasers really meant to be helpful,
they would surely pay full market values. Let’s be clear. If no-money-down
schemes are so wonderful, why do folks who engage in such investments have a
need for “partners” with cash?
Rather than get-rich-quick tapes and seminars,
prospective investors are best served by taking a basic real estate license
class in your state. This will explain much about financing, marketing,
title, and other issues. It will also allow an individual to take the
entry-level real estate exam and qualify for a license.
4. We made an offer on a home that was
about 5% below the asking price. Our offer was rejected. What can we do to
make the owners more reasonable?
Who says the owners aren’t reasonable? They have
established a market price for their home. If they can get that price
within a reasonable time frame, then they have logically priced their home.
If the price cannot be obtained, they will lower either the price or the
property will be withdrawn from the market. Because your experience in a
different market made selling at a loss acceptable, that does not mean the
same logic applies in other markets, or that your choice should in any way
impact the sellers. Perhaps it would make sense to restructure your offer -
maybe raise your price but seek better terms.
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