8 Ways to Protect Yourself When Buying a Home
- Written by Chloe Taylor
If you don’t have any experience in real estate, buying a home can be an exciting but stressful process. People who are new to real estate are in for a few unpleasant surprises if they don’t protect themselves when buying a property. From choosing the lender to considering resale value, doing all the important steps can keep you protected from many complications and ensure you get a beautiful home for you and your family.
Choose the right lender
The only way to buy a house is to have enough money to pay for it. Unfortunately today, most people don’t have that much cash lying around so it’s necessary to find a reliable lender to help you sort out your finances. The most common way to borrow money is to see a long-standing banker, but there are other lenders. To ensure you get all the money you need and know all the terms of returning it, it’s crucial to get a contract that explains your lenders' obligations and rights. Your lender needs to provide you with a written notice after they see a certified appraiser.
Get a home inspection
A property might look absolutely perfect to your untrained eye, but it’s not a good idea to rely on just your judgment—hire a home inspector first. Finding a home inspector can save you a lot of stress in the future because they know exactly what issues to look for even when they are not visible (rot, termite damage, electrical issues, etc.) Most banks require an appraisal to weigh their odds, but you should want one yourself because they can really offer a lot of protection.
Hire a lawyer
In many places around the world, it’s common to have a real estate lawyer on your side when buying (or selling) a property. For instance, in Australia, all buyers hire experts to do things like reviewing your paperwork, looking at the contracts before signing, etc. If you hire a professional conveyancer in Essendon, you can expect practical and theoretical advice to ensure that your investment is carried out promptly and free of stress. You can ask any questions about your rights and responsibilities, as well as any other questions that might prevent issues for you in the future.
Ask for property disclosure
When going to an open house, look for a property disclosure (or ask one from the seller). A property disclosure document is very important because it allows the seller to disclose or “hide” any potential problems in the property like issues with the structure of the house, leaking roof, HVAC that’s finicky, and home improvements that are undocumented. With the property disclosure documents, you’ll get an insight into all the things that might require an investment if you decide to buy. When you receive the property disclosure, study it carefully, calculate the costs, discuss with your partner(s) whether you’re comfortable with present issues, etc.
Check the titles
Before you sign any documents, hire a title company to investigate the history of the property and try to find any issues that might cause a problem when obtaining clear ownership of the house. The buyers are obliged to ensure this part is handled correctly, especially if you’re involved in any bank-funded transactions.
Inspect the area
One of the most important things in a house is its location, so to protect your interests and ensure a comfortable future for you and your family, make sure to do some inspecting of the area. Check out all the things that might concern you like the local schools, access to healthcare, closeness to public transport, as well as environmental factors like air pollution, flooding, earthquakes, etc. The availability of shops and markets can also impact the satisfaction you feel with the house down the road.
Consider resale value
This might be the first house you’re buying, but it most likely won’t be the last one. Unless you’re retiring and planning to age in peace, there are probably many more moves in your future. To ensure your investment is safe, it’s crucial to consider the resale value of the potential house you’re buying and how much you`ll have to spend on home improvements. The worst thing you can do is buy a property in a popular area in a real estate bubble just waiting to burst—this will ruin all the gain you might get on your investment. Instead, to protect your investment, consider buying an up-and-coming market that will probably push properties to increase in value in the future.
Open escrow account
Finally, open an escrow account that will hold your money and keep it protected until all the deals are made and all the documents signed. During the closing process, at the right time, the custodian of the account will distribute the funds according to the contract.
If you follow all of the steps above, you’ll be happy to know that your investment is safe and you didn’t get cheated in the process. Now you can enjoy your house and have a valuable asset on your hands for future use.
