“Buying a home is one of the biggest investments you’ll ever make,” is one of the first bits of advice you’ll hear when talking about the process of buying a home.
The statement over the years has become, well, cliché.
Most importantly, though, is that it’s a statement that incites panic.
My advice? Don’t let that “sage” advice get to you. Yes, you’re making a major financial investment when you buy a home, but you’re also buying a home. A place to live, to build memories, and to surround yourself with the things and people you love.
What are some keys to dealing with home buying panic?
- Gain knowledge about the home buying process
- Make sure you’re prepared upfront
- Following these steps in order
All of these steps begin with the assistance of one person: your real estate agent.
Knowledge: a brilliant cure for anxiety
I see you shaking your head – yes, suggesting that you choose your real estate agent carefully seems a bit self-serving. That doesn’t make it any less pertinent though, right?
We’re hardwired to fear, or feel threatened by, what we don’t understand. Without getting too technical, there’s a small part of our brain, the amygdala, that tells us when to be afraid, according to some scientists. Short of surgically removing this small, almond shaped structure, the only way to deal with fear is to face it, head on.
“Stress-hardy people focus their energy on those events that they have influence over, rather than situations beyond their control,” according to experts at the University of Minnesota.
And, while there are several aspects of a real estate transaction over which you have no control, there are many more over which you do.
Educate yourself about the buying or selling process by boning up on mortgages, on how to choose your real estate agent and on the processes that will follow and feel your anxiety melt away.
Then, take a preparation and call me in the morning
Even the most experienced professional real estate agent experiences the quickened heartbeat and clammy hands when buying or selling property. The difference between you and them, however, is their experience. They know what to expect, when, so the process is far less foreign.
Being prepared, not only with knowledge, but with practical steps to success, is worth its weight in gold in a real estate transaction. Once accomplished, the typical concerns of a novice fall by the wayside.
Planning is everything
If you won’t be paying cash for a home, you’ll need a mortgage, so the lending process is a good place to start your prep.
To ease your fears, you’ll need to know exactly what will be required to get the money you need for the least amount of effort and at the best price. This means fixing issues with your credit, raising your credit score and saving cash for the down payment and closing costs.
Learn all you can about the mortgage process. Freddiemac.com offers a brilliant walk-through of the process and who is involved in it.
Then, it’s time to get loan preapproval. Remember, the preapproval is an offer from a lender, not a commitment, so don’t just see one lender, but several. Compare the annual percentage rates offered and the terms.
Now that you know how much you can spend on a home, determine where you can afford to live and get crystal clear on what you want in a home. Yes, make a list and then check it, add to it, delete from it, but for heaven’s sake, share it with your real estate agent.
And, choosing that agent is the next step. Surprisingly, most home buyers choose the first agent they speak with, according to the National Association of Realtors.
You, on the other hand, won’t make that same mistake. You will be spending a lot of time with your agent, so it’s important to ensure that you choose the right one.
- The agent must be an expert communicator. Does he or she return calls, emails, and texts in a timely manner? A fun test is to call 5 agents and see which one returns your call with a call or text within 5 minutes. That’s the one you want because they are responsive! Also, get an idea if their is knowledge freely given? Do they communicate in easy-to-understand terms?
- The agent you choose must be a good listener. As you speak with agents, pay attention to whether or not they are truly listening. The last thing you want is an agent who doesn’t listen and shows you homes that don’t fit your list of criteria.
- Your agent should be experienced in the areas of town in which you’ll be house hunting. Agents who are more active in the areas or neighborhoods you want to be tend to be familiar with the market trends, schools and proposed commercial development nearby that could impact a home’s value in the future.
- Finally, how’s the chemistry? “Finding the right agent takes balancing credentials and chemistry,” according to the experts at CNN Money. As mentioned earlier, you’ll be spending a significant amount of time with your agent. Don’t add to your stress by choosing one you don’t enjoy spending time with.
Not all agents you talk to will have close to 300 reviews on Zillow, but once you’ve chosen your agent, get all the answers you need to allow for a relaxed process. Wondering what happens when you make an offer? Ask your agent to walk you through the process.
Common homebuyer concerns
What if I can’t make my payments?
This is why I always suggest that you see a lender first. You’ll be given an estimate of the maximum loan amount for which you qualify. Yes, there are online calculators where you can get an idea of what your monthly payments might be, but these are just that, an idea. Get firm numbers from a lender to make sure there are no surprises. If monthly finances are a concern, plan on buying a home well below your maximum pre-approval amount.
What if I overpay for a home?
This simply shouldn’t happen because if you are buying with a mortgage, your bank will hire an appraiser to appraise the property ascertain or certify current market value of the property. Now prior to getting to that stage of the process, ask your agent to run a comparative market analysis on any home for which you plan to make an offer.
What if there are problems not uncovered during the home inspection within due diligence?
Even with the most extensive inspections during due diligence, problems with a home may not be fully revealed. Keep in mind though, if you (your agent or home inspector) see additional red flags or concerns the inspection itself does not answer, you don’t have to stop there. In those situations you are encouraged to obtain the opinions and inspections by a roofer, heating and air contractor, plumber, electrician, general contractor, engineer and any other inspector you please to produce additional reports.
Throughout the home buying process keep checking your home buying plan, follow the steps in order, and tell your internal threat detector to relax. You’ve got this!