The New York Times had a fabulous, informative article the other day on five different ways for buyers to outsmart the market–great tips! While the article was written with New York in mind, all of the points are useful for anyone looking to buy. Here’s just a quick recap of the five tips, but please go to the website to read the full article.
1. Mortgage Hurdles. Get over the mortgage hurdles by having detailed discussions about the loan before even going to open houses. In this way, you will be getting a head start on gathering all of the documents the bank will want to see. That paperwork includes tax returns, bank statements and pay stubs, all of which will probably have to be resubmitted as newer versions arrive–a process that can take up to six months.
2. The Search. The search for both buying and selling used to be most effective in the spring, but times have changed. Now, it’s best to look for property right before the financial market turns exceptionally good, since there’s a rush to buy when the news is good and people feel secure. This past year, earlier-than-usual flurry of spring shoppers hoped to take advantage of the home buyers’ tax credit that expired at the end of April.
3. Pricing and Negotiation. Insights in pricing and negotiations can be found on websites such as NYTimes, StreetEasy, and Zillow, where previously how many times a property’s price has been cut, how long it has been on the market and how much the owner paid, were guarded secrets. Now buyers can see the history of a property, which gives them leverage at the negotiation table.
4. The Contract. Lenders are becoming more cautious and scrutinizing both buildings and buyers during the review process. Don’t let your eagerness to hurry up the review process and sign the contract override your own scrutiny of the building and your own cautiousness.
5. Getting to Close. Be prepared for delays when closing. The lenders seem to be the biggest delays in the process of contract to close. And that’s why it’s important to pay attention to Tip #1–avoiding the mortgage hurdles by finding out exactly what is needed before starting to browse homes for sale.
Go to the New York Times to read the full article.