Say Goodbye to Your Landlord: A Checklist for Potential Home Buyers

It is so exciting when you are ready to ditch paying rent and step into a new home! You dreamt about this for years, perusing the real estate listings online. Maybe some neighborhoods seem perfect for you and your family, and you have researched the school districts in those areas. When you talk to your friends and family who are homeowners, they might rave about the financial benefits of building equity and increasing property values. And in the age of do-it-yourself, home improvement TV shows convince you that you can tackle decorating projects as a weekend warrior. Echoing from all the residential experts out there is the term “pride of ownership”, and you are starting to understand what it means. As you rub your hands together, you think, “It’s time to move. How do I get started?”

Get Your Finances in Good Shape

Having a decent credit score will help you qualify for a better mortgage rate. If there are things you can do to clean up your credit before you apply with a lender, it’s best to pursue them first. Once you improve your credit score to the best of your ability, you can determine your rate on a mortgage, and hopefully, get pre-approved. Pre-approval means the bank has formally agreed that it is willing to lend you, up to a specific amount, the money to purchase a home. When realtors know you are pre-approved, they consider you a serious customer who has taken the steps necessary to make a home purchase sooner rather than later. Keep in mind that the lender will often approve a higher amount than what you can comfortably afford. You need to think realistically about what you really want to spend for the house on top of all your other monthly expenses (utilities, food, medicine, maintenance, etc.). When it’s time to discuss types of loans with the broker, make sure you understand the differences between fixed-rate vs. adjustable-rate mortgage (ARM). Ideally, you have saved enough for a hefty down payment on a fixed-rate mortgage, which will stabilize your interest rate throughout the term of the loan.

Decide How Much Room You Need

When deciding how much home to buy, consider the current number of members in your family or how many there might be in the future. Then you can ask:  How many bedrooms will you need? Where will the bedrooms be located and how big are they? Do you need an extra room for frequent guests or a home office? Will the closets accommodate your belongings, or will you need extra storage space? Will one full bathroom be enough, or should you have two? Add-on living spaces such as finished basements and screened-in porches will add square footage, so you can look for these features based on what you prefer. Discussing these options with your realtor will help narrow down properties that meet your needs and are in the right price range.

Visually Inspect Potential Homes During Open Houses and Walk-Throughs

Before you visit a listing, make a checklist of things to look for as you view the home. It’s easy to get sucked in by curb appeal and craftsmanship, but don’t forget about potential problems that could be lurking under paint, inside vents, above ceilings and other places. Home experts recommend keeping an eye on the following areas and features:

1. Walls – Are there cracks? Do you see fresh or a mismatched area of paint that might indicate a recent repair?
2. Ceilings – Are they sagging? Do you see water stains from a leaky roof or upstairs plumbing?
3. Floors – Are they uneven? This could indicate a foundation problem. Termites could also cause buckling. Are there any unexplained stains? What’s under the carpet? You could have layers of other flooring or nice vintage hardwood.
4. Doors – Do they shut completely? If door frames are crooked, this may also indicate a foundation issue.
5. Windows – Do you see mold on the frames? Is the wood soft? Either of these issues could signal extra moisture and rot. Do you notice any drafts that could increase heating costs? Windows can be expensive if you have several to replace at one time.
6. Heating and Air Conditioning (HVAC) – Do you see any rust on the furnace, air conditioner or water heater? If it’s winter, are all the rooms similar in temperature or are there cold spots? And vice-versa, if it’s summer, are all the rooms equally cooled? If you sense that the HVAC system is not running efficiently, it’s possible the units are old. You may end up calling a heating service and repair place sooner than you anticipated to replace a furnace or air conditioner.
7. Electrical Panel – Does it look outdated? Are there exposed wires? An outdated system can cause shorts, fires or shocks.
8. Plumbing – Are there leaks around the base of the toilet or under sinks? If you notice damaged copper pipes, it could be the result of hard water. You may have to wait until after the home inspection to get more information since it’s hard to tell if there are plumbing issues just by visual inspection.
9. Basement – Does it smell musty? Is there any visible mold on the walls or water on the floor? The water could be from a cracked foundation or from underground.
   

When you check out the exterior of the home and walk around the property, you should look at the following:

1. Foundation – Are there any visible cracks wider than a half-inch? Are there any areas that seem recently patched? If there is a problem with the foundation, you will have to hire a structural engineer to fix it. Do you see tiny tunnels of mud running along the foundation on the ground? These “mud tubes” are a sign of termites.
2. Attic – Do you see intake vents under the eaves and exhaust vents on the ridge of the roof? If not, the attic might not be well ventilated.
3. Roof – Are there any curling or missing shingles? Try to find out the age of the roof. Prepare to pay thousands if you need to replace it.
4. Yard – Are there any areas of standing water? This could indicate a drainage issue. A minimum 2% grade is needed to keep water away from the foundation.
5. Trees – Are there any trees with thick roots approaching the foundation? Are there any branches touching the house? If trees are too close they increase the risk of damage to the home if they fall or catch fire.

Investigate the Home’s History

Most seasoned homeowners will say it’s unlikely there won’t be an opportunity to talk to current or former homeowners. Contact the neighbors instead and find out about the neighborhood and property’s history. You can also search records through the local government to find out if there are any building permits, violations, or complaints.

Purchasing a home is one of the biggest financial commitments you will make. Using a checklist during the visits with your realtor can help to eliminate future dilemmas. Determine your needs and preferences and protect your investment with a proper home inspection before signing the mortgage paperwork. Expect some flaws in every home, but remember that eventually, you will find the one that is perfect for you!