Buying a Home? Read This First.
helpful tips for the first-time home buyer
Buying an existing home or building a new home may be the largest purchase of your life, therefore it should be entered into cautiously – especially for the first-time home buyer.
The first step would be to contact a lending institution to determine how much you can afford to spend on your new home. Keep in mind your income may allow you to buy a more expensive home with a payment per month that you will not be comfortable with. This eliminates looking at those homes out of your price range, and the disappointment that would have followed if you did.
The next step will be to locate an existing neighborhood or new subdivision in a location convenient to your present and future needs. Consider distances to schools, work, and shopping. Also consider undesirable features such as busy highways or streets and proximity to commercial or industrial sites, places with possible noise, lighting, or odor issues. Also check to see if there are any future development plans that may not be desirable.
After finding an existing home that fits your budget, location, and personal taste requirements, the next step is to procure an accepted offer to purchase, subject to a third party home inspection. Most lenders will require this inspection, but in all cases the buyer should demand such an inspection. This will point out any structural or mechanical problems as well as any potential health issues. The buyer can then negotiate with the seller to either correct the problem or adjust the price so the buyer can handle it themselves. It should be noted that the buyer will be in control at this point.
Building a new home will not typically require this third party inspection. Your new home would be built under a building code and watchful eye of a building inspector and require an occupancy inspection prior to moving in.
It should be noted if you are considering buying an existing home and remodeling that you check with zoning and building officials and check building covenants for the sub-division to ensure you can do the improvements you have in mind.
Building a new home will require considerably more time on the buyer's part. As well as the items mentioned above, you will need to consider building plans, contractor selection, selection of building materials, and the final contract price and documents. All of this needs to fit into your time frame and that of the contractor. How well you have done all this pre-project planning will determine if the path to the completion of your home is a smooth ride or filled with bumps and potholes.
Select your new home or remodeling contractors by talking to friends who have just built. Be sure they've built projects similar to yours. Ask for the past and present customer references, banking references, and trade references. Be sure to actually check these references out. Ask to see completed work as well as works in progress. Ask to see building credentials and insurance certificates and check that they're current. Above all, be sure they are someone you can easily talk to and that inspires confidence. After all, you're going to be business partners for the next several months.
It is usually best for first-time home buyers to indicate to their contractor their budget and what type of home they are considering (ranch, split level, two-story), bedroom requirements, bathroom requirements, great room versus living room, dining and family rooms separated, and basement and garage needs. This will allow them to return with plans that fit the budget and satisfy your needs. For move-up and luxury home buyers, you want to consider an architect or designer prior to talking with a contractor.
First-time home contractors typically have an existing library of home plans they can show you for starters in your price range, and you can customize these plans to meet your specifics and tastes.
For first-time home buyers, it is advisable to demand a firm price contract that includes price, material specifications, terms of payment, handling of change orders, final and detailed building plans, and production schedule. In terms of material specifications try to avoid "or equal" clauses as this allows for substitutions. Also in your fixed price contract there will be allowance amounts plugged in typically for cabinets and countertops, appliances, and light fixtures. While these allowance amounts are typically acceptable, be sure to spend the time shopping for these items prior to the signing so you are confident the dollar amounts will actually cover the quantity and quality of the items you want.
This article offers just a thumbnail sketch of things to consider when buying and existing home, or building a new home. For the most part contractors in the Chippewa Valley are professionals of high integrity and very proud of their profession. It's just a matter of finding the one you are most comfortable working with.