Buying a home? Don’t Make This REALTORⓇ Mistake!

WHY USE A REALTORⓇ WHEN BUYING A HOME?

So you want to buy a house, and you are excited because you have been to see your Mortgage Broker and have a pre-approval in hand. You know what kind of properties you can make an offer on, and how much you will qualify for.

Awesome! But wait! Are you out there looking on your own? I get it, you are excited, you have been looking at the real estate section of the paper an searching the MLS online. You have some good ideas about what you want to buy and it’s fun to get out and look at homes. So why not get out there and look by yourself? You are smart. You can see what you like, and you have even thought about the local amenities like schools, shopping and bus routes in your favourite areas of town, or not in town perhaps.

Don’t make the mistake of doing this on your own. You are FAR better off with a REALTORⓇ helping you.

A good REALTORⓇ will help protect you from mistakes you don’t even know about.

More in a bit on how to choose a good REALTORⓇ.

Here are my top reasons to use a REALTORⓇ when buying a home. (By the way I practice what I preach. I have used a REALTORⓇ each time I have purchased, and each time they have been a huge help to me.)

REALTORⓇs protect you – even from yourself.

You can be your own worst enemy when it comes to signing a contract. Let’s face it, you buy a property once every 5 to 15 years. Maybe even once a year if you are really into real estate. A Realty Agent worth their salt has seen 50 plus transactions in three to five years. They take regular industry education on how to write a good offer that protects their clients ,and they are governed by a regulatory body. In Alberta it is called the Real Estate Council of Alberta, or RECA for short.

What kinds of things can they do to protect you? They can make the offer subject to several conditions. Financing, and a property Inspection for example.

FINANCING CONDITION

You may be qualified, but what about the property?

What if it wasn’t disclosed to you prior to the agreement that it was a Grow-op?

What if it has overly high condo fees due to a badly managed condo corporation and you stand to have a large financial hit, if you buy it?

What if It’s built on a flood plain and as a result the house insurance will be prohibitively high?

Sometimes a property can be red flagged by the mortgage default insurers like CMHC, Canada Guarantee, and Genworth Financial, killing the deal. If you have less than 20% down and you want to buy it, you need these insurers to say yes to the property!

So you do want to have a financing condition on your offer, usually with a ten business day window to get the financing in place with conditions removed by the lender.

INSPECTION CONDITION

You need a licensed home inspector to have a look at a property before you remove this condition., and a good REALTORⓇ will make sure it is on the purchase contract. Again it is to cover your butt.

Imagine putting a condition free offer on a home and then finding out the crack in the basement floor has an $8000.00 drainage pipe repair lurking under it. Guess what? I have seen it. A good property inspector will do an extensive inspection of your prospective home to ensure that you don’t have black mould lurking in the attic or under counters

What about foundation problems? Or an improperly supported ceiling in that fifty year old home with a beautiful open floor plan, that is just waiting to droop and eventually fail.

THE IMPORTANCE OF INDEPENDENT LEGAL ADVICE

While your REALTORⓇ isn’t a lawyer and cant’t give you legal advice, they can give you advice to seek independent legal council. This is very important. As a buyer, it is unwise to use the same lawyer as the seller. You want a lawyer who is unbiased and willing to work on your behalf to make sure that you are protected. Examples of how they can protect you include:

Proper preparation of documents to ensure that you are correctly named on the contract, that you are the registered owner of the property on title for example.

Holding of deposits so that the seller can’t just go and have a party or buy a boat with your deposited funds.

Proper registration of the loan against the property and to make sure that there are no other liens in place before you take possession. Imagine buying a home and then getting a contractors lien against your newly purchased home because the seller didn’t pay for the kitchen cabinets that they just installed in the home. Guess who would have to pay to get that lien removed? Very possibly you, at the very least you could have major inconveniences arising from such an issue.

Licensed REALTORsⓇ are educated to know about these issues, and they work for you. They have a duty to abide by a code of ethics and are regulated by their industry and the government.

HOW DO I FIND A GOOD REALTORⓇ?

Use the recommendations of related professionals to choose a REALTORⓇ.

-Lawyers

-Mortgage brokers

-Financial planners

-Industry publications

-Family members and Friends recommendations.

You can even take a little time to do a Google search and read their reviews. You can find the best professional by reading their reviews. It is better to know before you hire someone.

You would be wise to ask all of these parties for their input. Then meet a few REALTORⓇs to see who you want to work with. Remember, you are making a big purchase and you want professional help.

News Reporter

3 thoughts on “Buying a home? Don’t Make This REALTORⓇ Mistake!

Leave a Reply

Your email address will not be published. Required fields are marked *