How to Protect Your Investment When Purchasing a Home

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How to Protect Your Investment When Purchasing a Home

Category:Buying a Home

Like anything else in life, real estate transactions don’t always go exactly as planned. Sure, we’d all LOVE to have our own home purchase go perfectly smoothly. The seller would just accept your first offer (and you’d get a GREAT deal), the home wouldn’t have a thing wrong with it and you’d move in 30 days exactly after signing the contract. Done.

But that would be boring. Instead you usually have a moment or two where you’re not sure if you’ve made the right decision. Rarely does the seller accept the first offer, and the home always has at least a few smaller items turn up in the inspection, if not one or two larger issues. So how do you protect yourself from making a huge, costly mistake and avoid some serious stressing out? Here are my suggestions…

1. Work with a reputable real estate agent (you knew I’d say that, right?). Find a licensed agent who you get along with and trust, who is competent, and who knows the market, and let that person guide you throughout the process. From finding the right home, to negotiating terms and inspection items, to making sure your loan application is on track and more, this person will make your life a lot easier.
2. Hire a local attorney. The attorney will review all the documents, advise you during the course of the transaction (which is especially important if anything goes wrong), and be present at closing to explain all the legal jargon in the many, many papers that you will need to sign. In this area the cost is usually a flat fee around $350-$500, and it is so worth every penny.
3. Get a home inspection. No home is perfect, and every inspection will reveal some things that may or may not be a big deal. But wouldn’t it be nice to know if the roof needs to be replaced BEFORE you buy the home? And if that dryer vent is a fire hazard, you’d probably like to know about that, too. If the inspector finds a flaw in the house, you have some options. If you don’t have the home inspected and don’t know about the flaws, you’re stuck with the house and every one of its problems. And that’s a little scary.
4. Buy good home insurance. You’ve made one of the largest purchases of your lifetime; now you need to protect your investment! Call up a few different insurance agents and get some quotes to make sure you’re getting the best deal. But don’t skimp. If you’re not sure whether or not you need a particular coverage for your area, talk to your agent about it. Tip: If you have auto insurance, you may be eligible for a discount if you purchase your home insurance from the same company.

Of course, there are always uncertainties and things that you cannot predict. But by covering these bases, you’re minimizing your risk of encountering a real estate disaster! Best of luck, and happy house-hunting!

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