Purchasing a house takes time, patience and careful planning. Many moving parts involved in the process, and sometimes buyers miss crucial steps—which can cost them big-time. Toward that end, Realtor.com reveals some of the more surprising home-buying moves you may not realize you have to make
Scrutinizing property disclosures
Once a seller accepts your offer, you’re typically provided with a property disclosure statement that essentially outlines any flaws that the seller (and their real estate agent) is aware of that could negatively affect the home’s value. These statements are required by law in most areas of the country, so buyers can know a property’s good and bad points before closing the deal. Because home buyers receive so much paperwork, however, it’s easy to overlook what’s in the property disclosures. Make a point to sit down with your real estate agent and read through the property disclosures together. Look for major issues such as a faulty foundation, leaky roof, HVAC problems, or pest and mold infestations. If you spot something on a disclosure statement that you don’t understand or that raises concerns, ask your real estate agent to bring it up with the listing agent because the seller might have an explanation that will put you at ease. But if the issue makes you seriously question whether you want to move forward, this could be an opportunity to renegotiate the sales price to compensate for the added risk you’re taking on buying this home.
Acquiring title insurance
When you buy a home, you take title to the property and establish legal ownership that is confirmed by local public land records. As part of the closing process, your lender will require a title search. You’ll also need to purchase title insurance that covers your property. There are two types of title insurance: The lender protects your lender alone and is typically required if you get a mortgage, and the owner protects your financial stake in the home against fraudulent ownership claims. Owner’s title insurance is optional but recommended, because lender’s title insurance won’t protect you personally if the insurance company loses a battle over the legal title. Without owner’s title insurance, you’d be required to pay for the continued fight over the title and could lose your investment in the property. Unlike other types of insurance, title insurance is paid with a single premium at the time of closing. If you’re buying a resale, you may be eligible for a reissue rate, which could offer a substantial discount off the regular premium since the title policy is already in effect, and the title research has already been completed.
Preparing for the home inspection
Most buyers make their purchase offer contingent on the results of a home inspection, a close examination of the property for defects by a professional. To get the most out of your home inspection, you’ll want to be involved in the process. Before your inspection, examine the interior and exterior of the property for potential problems and areas you would like the inspector to review carefully. For example, this could be the dark spots in the basement or underneath the bathroom sinks that could indicate water damage. Then create a written checklist. You should make sure to attend the inspection yourself to see if any problems arise, and don’t panic if your inspector gives you a seemingly endless list. While there are times when you should worry not every issue is critical. Your inspector will know which problems you should address with the seller. Barring any major renovations needed—such as a new roof or mold removal—your inspector’s visit will simply provide a to-do list that you can tackle one step at a time.
Reviewing condo or HOA rules
If you’re looking to buy a home in a community run by a condo board or homeowner’s association, you’ll be required to abide by its restrictive covenants. Also known as CC&Rs (covenants, conditions, and restrictions), restrictive covenants are simply the rules you’ll have to follow if you live in that community, as well as fines for infractions. After your offer to buy a home is accepted, you are legally entitled to receive and review the community’s CC&Rs over a certain number of days (typically between three and 10). You’ll want to go over them closely with your real estate agent. If you spot anything in the restrictive covenants you absolutely can’t live with, you can bring it up with the HOA or condo board, or back out of your contract completely with your deposit in hand.