I wanted to start this thread, since we were first time home buyers and closing tomorrow. There were few lessons learnt, that could be helpful to others in the same boat. Please chip in your lessons as well, so that entire community will benefit from it:
1. Affordability : Calculate on what is the maximum you can afford both for monthly payments and down payment. Do not forget to include HOA, Property Taxes, Mello-Roos, HomeOwnersInsurance. If you are stretching the last yard to close a deal on a property you and family liked, get your agent involved and get him/her to agree upon some credit towards repairs and/or closing costs. It is important to understand that agents also want to close your deal to get their commission. We were not aware of such requests. Remember, agents will not come forward to offer - you have to ask for it!
2. Renting before purchase : If you are renting and going month-to-month (MTM), once you start escrow - give 30-day notice (typically) of intent to vacate. Whatever happens in escrow, you can always extend by a few days or go another month MTM or sign a contract. This saves lot of money (on an avg, irvine residents pay $40-50 as rent per day. 10 days would get you $ to buy new things for your home). If you are renting and breaking the lease, find out in advance how much is the penalty? Try to sub-rent it through your friends till contract end date (I am sure there are many websites for that too), so that you can save your penalty.
3. Repairs : If you are first time home buyer, like us you probably never visited home depot or lowes for anything other than buying flower pots and furniture. So repairs are critical for you (atleast they were for us), especially when you are buying resale. If sellers does not accept, making your agent responsible to take care of repairs is good idea - then you can just look over the end result and share comments.
4. Contingencies : Sellers would like to remove contingencies soon, so that even if something happens (like escrow falling out for some reason) - the earnest deposit (the deposit for down that you pay while opening escrow) is retained. So, until you are sure all the aspects (home inspection and repairs, appraisal, HOA document review, Seller disclosures review, preliminary title report review, HomeOwners hazard insurance) as complete and to your satisfaction - do not remove any contingencies.
5. Living area : Sq ft is approximate. Sometimes it could vary by 5-10% depending who measured it. Some may skip measuring closet space and some laundry area etc., Most dependable ones are from builders, the ones with floorplan. This may mean your price per sq ft will vary. Since you may have finalized your purchase price (contract with seller), by the time you are aware of actual sq ft - you can bring it up with your agent if it is skewing some critical factors (such as price per sq ft) for your home purchase. There may be some credit that you could get, but mostly explanation. Appraisal report will show sq ft, but that could potentially be different from MLS and/or builder floor plan sq ft. They are mostly in 5-10% variation range. Appalling, but true!
More to follow...
1. Affordability : Calculate on what is the maximum you can afford both for monthly payments and down payment. Do not forget to include HOA, Property Taxes, Mello-Roos, HomeOwnersInsurance. If you are stretching the last yard to close a deal on a property you and family liked, get your agent involved and get him/her to agree upon some credit towards repairs and/or closing costs. It is important to understand that agents also want to close your deal to get their commission. We were not aware of such requests. Remember, agents will not come forward to offer - you have to ask for it!
2. Renting before purchase : If you are renting and going month-to-month (MTM), once you start escrow - give 30-day notice (typically) of intent to vacate. Whatever happens in escrow, you can always extend by a few days or go another month MTM or sign a contract. This saves lot of money (on an avg, irvine residents pay $40-50 as rent per day. 10 days would get you $ to buy new things for your home). If you are renting and breaking the lease, find out in advance how much is the penalty? Try to sub-rent it through your friends till contract end date (I am sure there are many websites for that too), so that you can save your penalty.
3. Repairs : If you are first time home buyer, like us you probably never visited home depot or lowes for anything other than buying flower pots and furniture. So repairs are critical for you (atleast they were for us), especially when you are buying resale. If sellers does not accept, making your agent responsible to take care of repairs is good idea - then you can just look over the end result and share comments.
4. Contingencies : Sellers would like to remove contingencies soon, so that even if something happens (like escrow falling out for some reason) - the earnest deposit (the deposit for down that you pay while opening escrow) is retained. So, until you are sure all the aspects (home inspection and repairs, appraisal, HOA document review, Seller disclosures review, preliminary title report review, HomeOwners hazard insurance) as complete and to your satisfaction - do not remove any contingencies.
5. Living area : Sq ft is approximate. Sometimes it could vary by 5-10% depending who measured it. Some may skip measuring closet space and some laundry area etc., Most dependable ones are from builders, the ones with floorplan. This may mean your price per sq ft will vary. Since you may have finalized your purchase price (contract with seller), by the time you are aware of actual sq ft - you can bring it up with your agent if it is skewing some critical factors (such as price per sq ft) for your home purchase. There may be some credit that you could get, but mostly explanation. Appraisal report will show sq ft, but that could potentially be different from MLS and/or builder floor plan sq ft. They are mostly in 5-10% variation range. Appalling, but true!
More to follow...
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