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If you're like most folks who are just starting to look for a home, you're not an expert on property values, financing, or tax and real estate law. And when your life savings are on the line, ignorance isn't bliss. Not understanding what's involved in the process of buying a home can cost you big bucks and make you unhappy with the home that you ultimately purchase.
How can you find your way through the convoluted maze of constantly changing real estate market conditions, local laws, regulations, and tax codes? Where can you sign up for a crash course in home values? Even if you have the aptitude, how will you find the time to become an expert in so many fields?
The team concept
Time and time again, smart people blunder into horrible situations while buying a home. More often than not, what gets them into trouble is ignorance of something that they should have known, but didn't.
Strangely enough, knowing everything isn't important. What is important is having good people on your team — people who know what you need to know so that you can solve the problems that invariably arise.
You don't have to become an instant expert in home values, mortgages, tax and real estate law, title insurance, escrows, pest-control work, and construction techniques in order to play the home-buying game well. You can choose to hire people who have mastered the skills that you lack.
Home buying is a team sport. Your job is to lead and coach the team, not play every position. After you've assembled a winning team, your players should give you solid advice so that you can make brilliant decisions.
 | If cost were no object, you'd hire every competent expert you could get your hands on. Because you probably don't have an unlimited budget, you need to determine which experts are absolutely necessary and which tasks you can handle yourself. You need to know which experts are generally worth hiring and which ones you can pass on. Ultimately, of course, you are the one who must determine how competent or challenged you feel with the various aspects of the home-buying process. |
The team players
Take a look at this thumbnail sketch of the possible players on your home-buying team:
- You: Always remember that you're the most important player on your team. In nearly every home purchase, something goes wrong — one of your players drops the ball or doesn't satisfy your needs. You have every right to politely, yet forcefully, insist that things be made right. Remember that you hire the players on your team. They work for you. Bad players may see things the other way around — they'd like to believe (and want you to believe) that they're in charge. They may try to manipulate you to act in their interests rather than yours. Don't tolerate this. You're the boss — you can fire as well as hire.
- Real estate agent: Because the home you're about to buy is probably the largest single investment you'll ever make, you must have someone on your team who knows property values. Your agent's primary mission is to help you find your dream home, tell you what the home is worth, and negotiate for it on your behalf to make sure that you don't pay one cent more for it than you absolutely have to.
- Real estate broker: Every state issues two kinds of real estate licenses: a salesperson's license and a broker's license. If your real estate agent is not an independent broker or the broker for a real estate office, then he (or she) must be supervised by a broker who is responsible for everything that your agent does or fails to do. In a crisis, your transaction's success may depend upon backup support from your agent's broker.
- Lender: If you can't pay, you can't play. And because most folks can't pay all cash for their homes, you probably need a loan to buy your dream house. A good lender offers competitively priced loans and may even be able to help you select the best type of loan from the financial minefield of loan programs available today.
- Property inspectors: A house's physical condition greatly affects its value. Your dream home should be thoroughly inspected from roof to foundation before you purchase it to ensure that you actually get what you think you're buying.
- Escrow officer: Mutual distrust is the underlying rule of every real estate deal. You and the seller need a neutral third party, an escrow officer, who'll handle funds and paperwork related to the transaction without playing favorites. The escrow officer is the home-buying game's referee.
- Financial and tax advisors: Before you buy a home, you should understand how the purchase will fit into the context of your overall financial situation. You should address the issues of what your financial goals are and, given those goals, how much house you can afford.
- Lawyer: You may or may not need a lawyer on your team, depending on your contract's complexity, where your dream home is located, and your personal comfort level. The purchase agreement you sign when buying a home is a legally binding contract. If you have any questions about your contract's legality, put a lawyer who specializes in real estate law on your team.
 | Odds are, you won't win the game unless you have a winning team. But remember that your players are advisors — not decision makers. You're the boss and decision maker. The buck stops with you. After all, it's your money on the line. |
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