You’ve scanned hundreds of real estate photos, picked the perfect bungalow, imagined painted kitchen walls the precise shade of white (white, but not too white), and measured the living room floor for the most divine hand-woven wool rug.
All that’s left to do is sign the contract and pop the champagne on closing day, right?
If only the home buying process were this easy. Reality, however, dictates that you’ll need much more information than what you can find scrolling real estate ads over a cup of coffee, especially if you’re a first-time buyer.
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Questions are a big part of home buying, and you’ll become comfortable asking about the unknowns. Some answers will come straight from your experience, but others will come from your real estate professionals’ expertise.
So, you think you’re ready to buy a house? The following questions will help you familiarize yourself with the big issues involved in the home buying process.
First Things First, Ask Yourself:
1) Am I financially prepared?
Many homebuyers see the asking price and prepare their finances accordingly. But there are many other payments to keep in mind. For starters, potential closing costs and home insurance premiums will add thousands of dollars to your overall home buying budget.
Don’t forget about the updates and renovation expenses you’ll want to begin immediately to make the house your own. Also, consider HOA fees or other memberships in your neighborhood that will require a down payment and/or monthly dues.
2) Am I comfortable with my target neighborhoods' crime and public school statistics?
This is not easy to answer without diligent research. Luckily, there are plenty of ways to investigate your local schools and law enforcement statistics. Start with school resources like your state’s board of education, the school’s PTA or PTO representatives, and multiple school ranking websites like SchoolDigger. If you want information about crime and safety in your area, review Family Watchdog, Area Vibes, or the U.S. Department of Justice National Sex Offender Public Website.
How to Find the Best School Solution for Your Military Kids
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3) Do I want to be a landlord if I PCS soon?
No one in the military can accurately predict their future, so hoping for the best and preparing for the worst is the best thought process for PCS planning. One common military homeownership scenario is the possibility of becoming a long-distance landlord if you don’t want to sell your property or cannot sell during a real estate downturn.
You should not take landlord responsibilities lightly, especially if your rental property is far from your current residence. Many military landlords ultimately hire property managers because they cannot properly care for the house due to the distance. Property management fees and regular rental upkeep will further burden your overall budget.
If landlord life isn’t for you, you should also be aware of your risk tolerance for losing money on your home sale if you’re forced to sell due to an unexpected move.
Don't miss this comprehensive resource created to help military landlords navigate the unknowns.
4) How much can I spend on a home?
A property’s purchase price is just the beginning of a homeowner’s financial responsibilities, so be careful when reviewing pre-approvals from lenders. There’s often a big difference between how much you can afford to spend and how much a lender approves you to borrow.
Just because a lender offers you a set amount, it doesn’t mean a holistic view of your finances agrees with the lender’s projected mortgage payment.
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Questions to Ask Your Real Estate Agent
5) Do you have expertise working with military families?
Military buyers have different needs compared to civilians. We often have short timetables, an impending storage delivery, in-processing deadlines to meet, and many other difficult situations. Your real estate agent should also be familiar with military acronyms and jargon.
Only an agent with working knowledge of these obstacles can smooth over the bumps in your transaction. Working with a Military Relocation Professional easily solves any issue that might be lost in translation by an inexperienced agent.
6) Are you willing to work with me long distance and under unusual time constraints?
An agent working with a military member must be up for unconventional home buying techniques. This may mean texting at inconvenient times or showing a house to a potential buyer via FaceTime or other video tech. You should also ask your agent if they’re willing to take on non-traditional services after closing, like helping you find contractors and vendors to begin renovations or repairs before you arrive.
Choosing the Right Real Estate Agent: A Guide for Military Home Buyers
7) Why do I need to pay for a home inspection?
Most real estate agents highly recommend a home inspection. It's a tool used to make a smart financial decision. Agents know that inspections prevent buyers from investing in unsafe properties or are not worth the money needed to repair or update. Inspections usually cost around $500, depending on your location and the property’s size. In the end, it's a small price to pay for peace of mind.
Sometimes, in extreme seller markets, your agent might suggest that you waive a home inspection contingency in your offer so yours looks more appealing to the seller. However, most agents still advise paying for a home inspection for informational purposes so you’ll know what to prepare for after the purchase.
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Questions to Ask Your Lender
8) Is the VA loan my best option?
Traditionally, the VA loan is an amazing benefit for military members that typically outperforms conventional loans. However, there are occasions when other loan products may better suit your specific financial situation.
For example, if heavy renovations are required, a VA loan might not be your best option or even applicable. Lenders have many loan options to discuss with you, including other affordable federal financing, like the FHA loan program.
9) How does my credit score affect my loan application?
Homebuyers are often under the impression that a low credit score excludes them from any chance of qualifying for a loan, but experienced lenders educate potential buyers about their choices and how their credit score affects which loans are available. They should also explain that a VA loan is an option that military buyers with lower credit scores often use for a first time home purchase.
Can I Buy a Home with Bad Credit? will help you decide if it's a good idea to buy.
The saying, “there’s no such thing as a dumb question," could have easily originated in the real estate world! Not only do first-time buyers have a lot to understand, but seasoned buyers may also encounter circumstances they haven’t negotiated before. The only way to ensure you have the correct information is to ask. Be honest about your housing needs and consult professionals in the industry to best prepare for a successful home purchase.
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