FeaturedReal Estate

The Benefits of Buying a New Home From a Private Seller

149views

Many homebuyers consider buying a new construction home from a private seller to avoid paying two mortgage payments and other closing costs. However, it can be a riskier option.

A real estate professional can research homes and determine whether asking prices are justified based on comparable sales data. They can also help you navigate the inspection and home warranty process.

You’ll Have More Control Over the Closing Process

After your loan is approved and you’ve paid for the home inspection, purchased homeowner’s insurance, and completed the closing checklist, it’s time to close the house. This is a critical point during which large sums of money change hands, and delays can be costly.

Fortunately, it’s uncommon for sellers to change their minds and kill the deal after the final contract is signed, but this is something to keep in mind. The closing could be delayed if the buyer’s lender has issues with the borrower’s credit, income, or assets.

In addition, you’ll want to conduct a walk-through and ensure that the seller has moved out and left the property in the condition you agreed upon. A well-versed New Home Star agent can help you stay ahead of the curve and avoid unforeseen closing problems.

You’ll Have More Control Over the Pricing

While a private seller will need more resources to advertise and market their home as a traditional sale, they may be willing to work with you on the price. They may also be more flexible with contingencies, such as home inspections or mortgage loan approval.

The amount of room for negotiation will depend on the real estate market in your area and whether it’s a buyer’s or seller’s market. If the home is in high demand and you’re competing against many other buyers, you may have to offer above asking price. However, you can often leverage a small discount by paying cash or offering a larger down payment. This will show the seller that you’re a serious buyer. A pre-approval letter from your lender is another excellent way to demonstrate this.

You’ll Have More Control Over the Inspection Process

After you’ve finished all required inspections and gotten final approval for your mortgage, it will be time to close. This is when homeownership will be transferred to you, and you’ll pay your down payment and closing costs. If your home inspection uncovers major issues, you can choose whether to proceed with the purchase, request repairs or renegotiate the sale price.

pre-listing home inspection will reveal many items you can use to make your home more appealing to buyers. For instance, if your inspection report shows that the roof has many years left, you can highlight this in the listing description. This can help entice buyers to put in an offer. Moreover, waiving the inspection contingency in a tight market can make your offer more competitive.

You’ll Have More Control Over the Down Payment

A traditional rule of thumb for buying a home is to save up to 20 percent of the purchase price for a down payment. This is significant for many first-time buyers and can take time to save.

But what if you’re on a timeline to buy a new home before selling your current residence? In that case, you may need to consider a sale leaseback.

That way, you can use the proceeds from your old home to buy a new one without paying for temporary housing or storage expenses, realtor fees, and other transaction costs. But you’ll need to carefully review your finances and financial goals to determine if this is the right option. The amount you choose will also affect your mortgage-to-value ratio, impacting loan rates and fees.

You’ll Have More Control Over the Closing Costs

One of the biggest outlays when purchasing a property is the closing costs. While they are a necessary part of the process, they can be difficult for buyers to swallow.

A private seller may be willing to cover some of the closing costs. This can be a great way to reduce the cost of purchasing a new property.

However, remember that a private seller is unlikely to subject you to the stringent loan approval procedures that mortgage lenders use. This means your credit will be run, and you could be turned down if you have poor credit. As a result, shopping around for the best rates on closing costs is essential. You can also reduce your closing costs by shopping for the best deals on home insurance and pest inspections.

Leave a Response