St. Louis Real Estate Blog

5 Real Estate Rules you shouldn't break

February 21st, 2014 1:04 PM by Melanie Mitchell - Team Lead/Listing Specialist

 

Spring signals the start of two hallowed seasons: homebuying and baseball.

Like the national pastime, purchasing a home supposedly comes with its own set of “unwritten rules.” Conventional wisdom and considered opinion have long led consumers to believe you never make an offer on the first home you tour, or you always close at the month’s end.

The reality is the only rules you have to follow relate to mortgage fraud (one might regard them more as federal statutes than rules). Homebuyers and real estate agents routinely flout common “Never this or that” industry truisms when the need arises.

But make no mistake. While there aren’t hardcore “rules” to follow, there are absolutely best practices and proven precepts that you should carefully consider. Here’s a look at five big ones.

1. Don’t Make an Offer Without Pre-Approval

Getting pre-approved means a lender has vetted your credit and financials and is so far willing to continue the mortgage dance. Pre-approval letters detail your purchasing power and provide sellers and real estate agents a degree of confidence they won’t get anywhere else.

The chicken-or-egg debate will rage on regarding whether to talk first with a real estate agent or lender. Either way, you may not want to start touring homes or making offers without a pre-approval letter in hand.

2. Use a Real Estate Agent

For many consumers, buying a home is the single biggest purchase they’ll ever make. It’s something you’ll do maybe a handful of times. It can pay to have an expert in your corner.

Real estate agents show homes, negotiate contracts and close deals every month. They can help identify red flags and potential problems, all the while working to best match up properties to your unique needs.

The Internet has certainly helped demystify and democratize the home buying process. But consumers may still want an industry professional on their side. Nearly 90% of homebuyers use a real estate agent or a broker, according to the National Association of Realtors.

Make sure you pick an Agent that specializes in the area in which you are purchasing.  If you are looking in Eureka, MO then choose a Top Agent that is active in listing and selling in the Eureka area.

3. Put Down Earnest Money

It’s customary, if not legally required, to provide a deposit when you make an offer on a home. Known as earnest money, this deposit is typically 1- 2 % of the purchase price, although the amount can vary by location and other factors.

Consult with your real estate agent regarding the right amount, and quibble if you dare. Earnest money follows in line with loan preapproval – it’s another way to show a seller you’re a serious, legitimate homebuyer.

Be sure your agent includes contingencies in the sales contract that allow you to recoup the deposit in case the deal falls apart. Common reasons include a bad appraisal, inspection issues or your inability to sell your current home.

4. Sell Yourself

Don’t just submit a solid offer and cross your fingers if you’re shopping in a competitive real estate market. Take every opportunity you get to tell your story and sell yourself.

Include a handwritten letter with your offer. Ask your real estate agent to convey your admiration for the property and your hopes and dreams to the listing agent.

"Home selling can be as personal and emotional as buying a home, let the seller's know your thoughts about the home.  Most sellers want to know their home is going to caring buyers" said Real Estate agent Melanie with Realty Executives Premiere.

5. Tour Homes in Person

Mobile video technologies like Google Glass are ushering in a new era for home tours. Cool tech and new apps can be a huge help for consumers moving to new states or service members purchasing homes during a deployment.

These tools will continue to be widely used in the home search process.  But, nothing is better then seeing the home in person as well as the neighborhood and surrounding areas.  Touring homes in person gives you a feel for the home and community you are moving into.

Posted in:General
Posted by Melanie Mitchell - Team Lead/Listing Specialist on February 21st, 2014 1:04 PM

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