Always check to see if the house is in a low-lying area, in a high-risk area for natural disasters (like earthquakes, hurricanes, tornadoes, etc.), or in a hazardous materials area. Be sure the house meets building codes. Also consider local zoning laws, which could affect remodeling or making an addition in the future. Your real estate agent should be able to help you with these questions.
Real Estate
Lender Responsibilities
Lenders are not allowed to discriminate in any way against potential borrowers. If you believe a lender is refusing to provide his or her services to you on the basis of race, color, nationality, religion, sex, familial status, or disability, contact HUD’s Office of Fair Housing at 1-800-669-9777.
School Value
When looking for a house, be sure to check out the local schools, even if you don’t have school-age children. Research has shown that properties near good schools appreciate faster in strong markets and hold their values better during weak markets.
Foreclosure Risks
Buying a foreclosure property can be risky, especially for the novice. Usually, you buy a foreclosure property as is, which means there is no warranty implied for the condition of the property (in other words, you can’t go back to the seller for repairs). The condition of foreclosure properties is usually not known because an inspection of the interior of the house is not possible before the sale. In addition, there may be problems with the title, though that is something you can check out before the purchase.
Housing Needs
Your home should fit the way you live, with spaces and features that appeal to the whole family. Before you begin looking at homes, make a list of your priorities – things like location and size. Should the house be close to certain schools? your job? to public transportation? How large should the house be? What type of lot do you prefer? What kinds of amenities are you looking for? Establish a set of minimum requirements and a “wish list.” Minimum requirements are things that a house must have for you to consider it, while a “wish list” covers things that you’d like to have but aren’t essential.
Loan Payoff
By sending in extra money each month or making an extra payment at the end of the year, you can accelerate the process of paying off the loan. When you send extra money, be sure to indicate that the excess payment is to be applied to the principal. Most lenders allow loan prepayment, though you may have to pay a prepayment penalty to do so. Ask your lender for details.
Mortgage Insurance
Mortgage insurance is a policy that protects lenders against some or most of the losses that result from defaults on home mortgages. It’s required primarily for borrowers making a down payment of less than 20%.
Stale Listing Syndrome
Buyers sometimes ignore houses that have remained unsold for a long period, assuming, often incorrectly, that they must have serious flaws. One way to avoid the stale-listing syndrome if your house isn’t attracting buyer interest is to withdraw it from the market temporarily and then relist it, so it will appear fresh to brokers and to buyers, who won’t be put off by the old listing date.
Disaster Damage
Homeowners should contact their insurance carrier as soon as possible to begin the claims process; however standard homeowner policies do not cover flood damage.
FEMA provides housing assistance for qualifying disaster victims. Homeowners within a designated federal disaster area may call toll-free 1-800-621-FEMA (3362) to register for assistance. Applicants should be prepared to describe losses and provide their Social Security number, financial information, and directions to the damaged property.
Keeping Track
If possible, take photographs of each house: the outside, the major rooms, the yard, and extra features that you like or ones you see as potential problems. And don’t hesitate to return for a second look.