Welcome to the EasyUtahHomeSearch.com Blog

2012-01-30 12:10:46
How do I know I'm getting a good price on my home?

Last week we talked about all the ways a home seller can use to price their home.  We discovered that only a few ways truly work in a way that will ensure the seller gets the most money from their home sale.

 

This week we're taking it from the perspective of the buyer.  'How do I know I'm getting a good price on my home?'  Some of the info may truly be surprising. I hope you enjoy it and maybe share it with any of your friends that are considering buying a home now!

 

Let's start with the basics of buying a home:

  1. Meet your Realtor (there are many reasons to have a realtor and not a single good reason not to!)
  2. Get pre-approved for a loan.
  3. Go home shopping
  4. Fall in love with your perfect home
  5. Negotiate and get an accepted offer
  6. Get home appraised and clear all lending requirements
  7. Move in and live happily ever after!
Now this may seem a bit of a simplification, and it is, but it's the general route you take when buying a home.  Where in this list do you find 'find out you got a fantastic deal!'?  Well, it's not that obvious is it?  There are actually several parts that are key to you knowing you got a great deal on your home.  Let's dissect a little further to see how you can know for sure.
Step 1: Meet your Realtor: A good realtor (much like the listing side we discussed last week) will be anxious to inform you and help you make an educated decision.  However, just like last week's article, there are some bad agents out there that can be working on their own agenda.  What you want is one that truly helps you feel informed.  If you start to feel like a puppet on strings, you've got a problem.  Having an informing agent is part ONE of knowing you got a great deal.  It's important because your real estate agent can tell you the $/sq ft that you don't see anywhere else, can help you know which areas are more valuable than others (location, location, location).  A good agent also helps with all the following steps after Step ONE.  They help getting you in touch with a great lender! (Don't use your brother-in-law/ friend/ neighbor, etc--you will never get as good treatment as you will from your real estate agent's specialist!)  They help you trim months of frustrating searches down to a couple weeks and you actually are MORE informed about the market than without.  The streamline your shopping time by scheduling all the details out in advance so you can show up and enjoy the show.  They help you see minor details that may escape your notice and hook you up with competent home inspectors so you can feel at peace with your purchase decision.  They help negotiate so you get the best possible deal, and they work hand in hand with your lender to make sure all the lending details line up with your deadlines to protect your earnest money.  The only thing they don't do is the appraisal!
Funny thing about all this is that most home owners rely solely on the appraisal to tell them if the home they are buying is market value!  It doesn't work that way.  See last week's article to see how appraisals work.  Imagine you're buying a property that your agent tells you is way under valued...it's a great deal.  Yet when the appraisal comes in, it comes in just over purchase price!  That doesn't make sense...how could it be?  Have you been tricked?  No, just not fully informed (which you are now after reading this article.)  If an appraiser gives a value, say $20,000 above the agreed purchase price, the underwriter will look at that and say, 'what's going on here?  Is this fraud?  If the home is truly worth that much, why isn't it selling for that much?' and they will require another appraisal to be done!  That cost goes squarely on the buyer's shoulders...another $450.  Not only that, but the first appraiser goes on a 'watch list'.  Kind of like Yellow Alert.  The banks are going to keep an eye on this wise guy...trying to pull a fast one!  So, appraisers don't do this.  They see what the purchase price is on the contract.  They find 3-5 comps that will justify that price (only if they truly can justify it...they won't commit fraud for you by over-valueing a home, but they will undervalue a home for you).  When all is said and done, your home purchase cruises through underwriting without raising an eyebrow...which is what you want.
So, the moral of the story is, get a great agent first...they're free to use and they have to many bonuses to pass up!
Eric Lee
Realtor/Broker/Real Estate Coach
801-651-3071
eric.lee@equityutah.com
www.EasyUtahHomeSearch.com
 
Blog Archive
2012-07-09 11:38:10
Buyers and Multiple Offers in Real Estate

2012-04-02 10:14:02
FHA mortgage insurance increases

2012-03-14 15:15:40
Moving to Utah...Here's some studies you may find

2012-02-29 11:21:54
Mortgage insurance premiums on the rise again…

2012-01-30 12:10:46
How do I know I'm getting a good price on my home?

2012-01-26 10:20:06
How do I know I'm getting a good price on my home?

2012-01-03 10:35:02
$100 Down to Buy a HUD Home!

2011-12-27 08:21:56
Odds & Ends - Superstitions & Saint Joseph

2011-12-23 12:52:37
House Movers when you buy or sell your house!

2011-12-15 13:59:51
LOKAL SKOOL DISTRIKS - worth knowing about!?

2011-12-13 13:10:19
Homeowners Insurance - a Poem

2011-12-09 14:06:33
WHEN WILL HOME PRICES START TO GO UP?!

2011-12-09 13:00:09
For Sale By Owner! When it works, when it doesn't!

2011-11-16 13:41:17
Understand Realtor Lingo! MLS 101

2011-11-04 17:17:50
YOUR PRICELESS PET!!

2011-10-26 14:36:54
The LAST House A BOOMER will Own!


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