The home buy­ing process ex­plained

Sun Sentinel Broward Edition - Homespot - Broward East - - REAL ESTATE NEWS/PEOPLE ON THE MOVE - By Ilyce Glink and Sa­muel J. Tamkin

Tri­bune Con­tent Agency Q: Ihave­been rent­ing for about two years and am in­ter­ested in buy­ing the home I cur­rently live in. The land­lord is will­ing to sell. What do I do next? A:

If you and your land­lord have agreed on the terms of the sale, your next step will be to hire a real es­tate at­tor­ney if you live in a state where real es­tate at­tor­neys gen­er­ally help buy­ers and sell­ers in res­i­den­tial real es­tate trans­ac­tions, or a clos­ing at­tor­ney or set­tle­ment agent to help you out.

You’ll need to com­plete a real es­tate pur­chase and sale form. This doc­u­ment sets forth the busi­ness terms that you and your land­lord have agreed to when it comes to the sale of the home. Fur­ther­more, even if you’ve lived in the home for two years, you still might want a pro­fes­sional home in­spec­tor to go through the home with you. It’s one thing to know the dish­washer and dis­posal are work­ing but it’s an­other thing to un­der­stand how old the roof and me­chan­i­cal sys­tems are, what prob­lems there might have been in the past and whether the foun­da­tion has any is­sues.

As with any real es­tate home pur­chase, you want to make sure that you know what you’re buy­ing.

We also rec­om­mend that you talk to a mort­gage lender or mort­gage bro­ker be­fore you sign the con­tract to make sure your fi­nances and credit his­tory are in or­der. Buy­ing a home is ex­pen­sive, so we also want you to un­der­stand how much it will cost you to buy the home. All this in­for­ma­tion and more will help you even be­fore you sign on the dot­ted line.

Here’s some­thing that of­ten gets for­got­ten when buy­ing di­rectly from an owner: an owner’s ti­tle in­surance pol­icy. While your lender will re­quire you to pay for lender’s ti­tle in­surance, you should make sure you also buy and re­ceive an owner’s ti­tle in­surance pol­icy for your pur­chase to pro­tect your in­vest­ment in the home (like your down pay­ment). In some states, the seller is re­spon­si­ble for the pay­ment of the owner’s ti­tle in­surance pol­icy, but in oth­ers, you will have to pay the owner’s and lender’s ti­tle in­surance poli­cies. They’re worth it!

Depend­ing on to whom you talk, we’d like you to un­der­stand what it will cost you to own the home, what your monthly ex­penses will be and what you might an­tic­i­pate in home re­pair ex­penses down the line. Be­tween your at­tor­ney, the lender and your home in­spec­tor, you should have a bet­ter idea on these num­bers. You may even get a fi­nan­cial ben­e­fit on your fed­eral in­come tax re­turns if you can deduct the mort­gage in­ter­est pay­ments and real es­tate taxes while you own the home – but only if you are able to item­ize your de­duc­tions on your fed­eral in­come tax re­turn.

We also hope you’ve done your home­work on un­der­stand­ing the value of the home you are buy­ing. We’ve seen plenty of peo­ple think they are get­ting a good deal when they do things on their own only to find out that the mar­ket for real es­tate is ac­tu­ally way off from what they thought. If you do your home­work, you’ll be ahead of the game. And your home pur­chase should work out just fine. Good luck.

Ilyce Glink is the cre­ator of an 18-part we­bi­nar and ebook se­ries called “The In­ten­tional In­vestor: How to be wildly suc­cess­ful in real es­tate,” as well as the au­thor of many books on real es­tate. She also of­fers in­for­ma­tion on her YouTube chan­nel. (youtube.com/user/Ex­pertRealEs­tateTips).

Con­tact Ilyce and Sam through her web­site, ThinkGlink.com.

© 2016 Ilyce R. Glink and Sa­muel J. Tamkin. Dis­trib­uted by Tri­bune Con­tent Agency, LLC.

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