How to be the Best Buyer
When buying a first home, second home or investment property, it is crucial to have your finance first and then look for houses you are interested in after. The reason being, buyers fall into the trap of looking for a property, finding one they want to buy and then approach a bank to arrange finance. First and foremost, it is a mistake to arrange finance after you have found the property you want for three main reasons;
- After agreeing on a purchase price, you then tell your agent/ vendor that the price is subject to finance you do not have yet- This immediately weakens your position and puts the vendor to believe the agreed price does not mean anything at the moment. Depending on what amount you find out, you can get loaned to you.
- Not having the money up front, makes the vendor lose interest in your offer. Losing interest only makes them think that there are other potential buyers out there with ready to go offers, that could be potentially better waiting in the background, in case your offer falls through.
- Above all, if your loan application is not approved, and the vendor receives the same offer from someone else that is loan approved, can result you to face the potential loss of not calling that property home.
Note to self: don’t fall into the trap by not being prepared to buy a home. Get your loan application approved, set your budget to what you can afford. Leave some money to the side, if the home you’re interested in needs a little love and care after you buy it, then you can start to fix the home in a way you want straight away with the money left aside to do so. Be a winner in the housing game and put yourself above the crowd!
Putting yourself in a position to successfully buy with sorting your finance out first, leaves you with:
- Looking disciplined to a vendor, by being efficient and knowing what you can spend, price range, and negotiating a price you know you can pay on the spot. Can result you in a purchase of the property and potentially shorten the process from the idea to settlement.
- With the agreement on price that can be paid with certainty, the contracts can be exchanged sooner, and the vendor of the house can relax that property is sold.
Simply having your finance in order to purchase a home, puts you the buyer in a position to take advantage of these circumstances and potentially buy the property at a much better price than the asking price. Simply having your finances in order, results you to be the best buyer possible in the housing market.
Bill Shepherd Real Estate