So you’re considering whether it's time to buy some real estate. But hold on before committing to the idea and first check out these five questions that you should ask yourself before you taking the home-buying plunge. Now, if after that little quiz you find that you're still game about homeownership, let’s discuss some additional things so that you can make a smart and safe purchase decision.
First, realize that real estate ownership is extremely high risk. Surely you've heard about or even know one of the millions of Americans who are unfortunately losing their homes lately. Making a poor financial choice is just one of the many risks that comes along with owning property.
Full disclosure: Your humble author is a very experienced real estate buyer and is willing to help guide you. However, he fully admits that he has been burned many a time on real estate deals, but brags that over the past 20 years, he has gotten a little smarter and more experienced each time he closed escrow on another property. Now, I want you to learn the same hard and expensive lessons I've learned, except without having to go through the trouble and expense of learning things the hard way.
Therefore, I've created a checklist to help you reduce your risk, expense, and problems on a real estate purchase. Helping me out with the checklist is my attorney, CPA, insurance agent, mortgage lender, home inspector, HOA expert, title insurance officer, and even my website designer (who owns more properties than all of the others combined!).
However, keep this in mind: There is no such thing as risk-free real estate. Doing the proper due diligence can only reduce your risk, but no matter how hard you work at it, you can never completely eliminate real estate risk.
You can download the checklist here and print it out to learn the different things that experienced buyers can use to reduce their risk when purchasing property. The items on this list include:
- General information on the buying process
- How to pencil out a real estate deal to buy cash flow positive properties
- Items you should consider when buying a personal residence
- Information about foreclosures, short sales, MLS traditional sales
- How income taxes impact your real estate ownership
- How to get a fair deal on mortgage financing
- How to analyze a homeowners association to avoid disasters
- What you should consider in a home inspection
- Property and liability insurance information
- Title insurance and holding title information
In addition, there's lots of other great information for you that will hopefully allow you to reduce your home-buying risk.
Too many people spend far more time researching on different ways to save $0.10 per gallon on gas than they do researching on the largest, riskiest, and most complicated purchase they will ever make. Don't be one of these people. When you are ready to buy, educate yourself, take your time, and make a great choice on a property you will hold for a long time! You’ll be glad you did!