As your closing date nears, everyone involved in your real estate transaction should check its progress on a daily basis, because staying on top of things means you'll know immediately if there's a problem that must be dealt with. Here's a bit of information that focuses on a few common problems that home buyers must deal with before they close on a house.

No one loves shelling out money for unexpected expenses, but sometimes that seems like a rite of passage in homeownership. “Most of the time, the unhappy surprises are simply due to people being unaware of the things that can crop up,” says Brad Hunter, chief economist for HomeAdvisor. First-time homebuyers in particular may not know what to expect after closing on a home, and there’s nothing worse than developing buyer’s remorse about one of the largest investments you’ll ever make. Here are eight headaches to prepare for if you’re looking to purchase a house.
A title search and title insurance provide peace of mind and a legal safeguard so that when you buy a property, no one else can try to claim it as theirs later, be it a spurned relative who was left out of a will or a tax collecting agency which wasn't paid its dues. A title search is an examination of public records to determine and confirm a property's legal ownership, and find out what claims, if any, are on the property. If there are any claims, those may need to be resolved before the buyer gets the property. Title insurance is indemnity insurance that protects the holder from financial loss sustained from defects in a title to a property, and protects both real estate owners and lenders against loss or damage occurring from liens, encumbrances, or defects in the title or actual ownership of a property. 
Once you've got your savings growing, your down payment set, and you are pre-qualified and pre-approved, start the search for your home. Begin by using sites like Zillow.com or Realtor.com to zero in on the home you want and the community you want to live in. Factor in key lifestyle needs -- like good schools, decent commute to your job, manageable property taxes, and ultimately, a home that has a good chance of appreciating in value if you ever want to sell it.
Even when your purchase offer has already been accepted, if inspections reveal any problems, you may want to renegotiate the home's purchase price to reflect the cost of any repairs you will need to make. You could also keep the purchase price the same but try to get the seller to pay for repairs. Though you may not have much scope to demand for repairs or a price reduction in case you're purchasing the property "as is," there is no harm in asking. You can also still back out without penalty if a major problem is found that the seller can't or won't fix it.
In a seller’s market, experts advise buyers to overlook cosmetic issues, such as loose fixtures, water stains (as long as it’s not the symptom of a larger problem), failed window seals and cracked tiles. However, some buyers might be in the position to negotiate these repairs with the seller. One option is to ask for a cash-back credit at the close of escrow. This will save you some money and you can oversee the repairs yourself.

Speaking of mortgages, Gilmour recommends that payments generally not exceed 28% of your monthly gross income—but if you have other high costs, such as private school tuition, it can be wise to pare down this percentage even more. If you're not sure what's realistic, consider seeking help from a financial professional, who can help walk you through an appropriate breakdown, based on your individual situation.


First-time homebuyers are often moving from rentals that use less energy (gas, oil, electric, propane, etc.) and water than a larger new home will. It is easy to be ambushed by soaring rates when your new house has ceilings higher than your rental – or older windows that leak air. Then there are unexpected utilities, such as buying gas to power a lawnmower. These costs can blow a budget.

One of the ways your lender makes sure you and your house are a good bet is with a home appraisal. This is when someone does a professional evaluation of how much your home is worth. If the appraisal ends up higher than your offer, go celebrate. If it’s not, you may either have to make a larger down payment, get a second opinion, or renegotiate the price. Or you may decide to walk away from the deal.​


Next, review exactly how much you’re spending every month – and where it’s going. This will tell you how much you can allocate to a mortgage payment. “Make sure to account for every dollar you spend on utilities, kids' activities, food, car maintenance and payments, clothing, entertainment, retirement savings, regular savings, miscellaneous little items, etc., to know how and where a new mortgage payment fits into your budget,” says Liz Recchia, owner/broker at We Sell Real Estate, LLC, in Phoenix, Ariz., and author of “HELP! I Can't Make My House Payment!”
If you're thinking about making an offer on a home, take another look at your budget. This time factor in closing costs, moving expenses and any immediate repairs and appliances you may need before you can move into the home, notes Felipe Pacheco, President/CEO of Avanti Mortgage, who is based in the greater Salt Lake City area. Don’t overlook hidden costs such as the home inspection, home insurance, property taxes, homeowners association fees and more.
You can find for-sale properties through listing websites, local publications and your real estate agent. Start touring homes to develop a sense of what you want and don’t want in your home, as well as what type of inventory is available in your desired neighborhood. Once you find a property that meets your needs, work with your agent to negotiate a fair price with the seller.
Paranoid buys are sometimes difficult to work with. They may not believe the price is an accurate assessment of the house's market value. They'll submit low-ball offers and then show frustration when they are consistently rejected. Paranoid buyers don't trust real-estate agents, and may even try to buy their home without an agent, which is generally an unwise choice.

Do some research online, but work with a live person who can review your situation, answer questions and, if necessary, suggest how you can improve your credit.“Online calculators do not always include insurance and taxes or PMI [private mortgage insurance required if the down payment is less than 20%] and are not always an accurate picture of what the payment or actual fees for the loan are,” says Anita Wagoner Brown, director of sales and marketing for Home Creations, the largest new home builder in Oklahoma.

The home buying process can take anywhere from one month to a few years, depending on the unique experience and expectations of the home buyer. On average, a home buyer can spend one to two months searching listings, several weeks to negotiate and close a deal, and then make the first mortgage payment several weeks after that. With these variations in mind, a home buyer can realistically expect for the home buying process to take roughly three months.
As long as you have lived in your home for two of the past five years, you can exclude up to $250,000 for an individual or $500,000 for a married couple of profit from capital gains. You do not have to buy a replacement home or move up. There is no age restriction, and the "over-55" rule does not apply. You can exclude the above thresholds from taxes every 24 months, which means you could sell every two years and pocket your profit—subject to limitation—free from taxation.
Here’s why: The lender’s mortgage decision is based on your credit score and your debt-to-income ratio, which is the percentage of your income that goes toward monthly debt payments. Applying for credit can reduce your credit score a few points. Getting a new loan, or adding to your monthly debt payments, will increase your debt-to-income ratio. Neither of those is good from the mortgage lender’s perspective.

Home inspectors aren’t able to see through walls, so the discovery of a pipe leak isn’t uncommon after you’ve moved into the home. But this is one repair you want to make as quickly as possible. “When there’s water that is not stopped, it can create mold – and mold remediation is extremely expensive and extremely difficult,” Hunter says. Mold growth in your home can cause serious health problems, so it’s imperative to address any moisture issues as quickly as possible to avoid it becoming any more dangerous, let alone more expensive.
A title search and title insurance provide peace of mind and a legal safeguard so that when you buy a property, no one else can try to claim it as theirs later, be it a spurned relative who was left out of a will or a tax collecting agency which wasn't paid its dues. A title search is an examination of public records to determine and confirm a property's legal ownership, and find out what claims, if any, are on the property. If there are any claims, those may need to be resolved before the buyer gets the property. Title insurance is indemnity insurance that protects the holder from financial loss sustained from defects in a title to a property, and protects both real estate owners and lenders against loss or damage occurring from liens, encumbrances, or defects in the title or actual ownership of a property. 

4) Choose the right loan term for your needs. A 30-year loan has lower monthly payments and can be advantageous if you'll make good use of the savings by investing them or paying down high interest debt. You can always make extra payments if you want to pay the loan off sooner. But if you're honestly more likely to splurge the money you save each month with a 30-year loan, the 15-year loan could be better since it will cost you less in interest and you'll pay it off sooner.
Your property taxes are a fixed percentage of your home’s value based on the tax assessor’s appraised value of your home. Property taxes are paid to township or county in which the home is located. You will pay this tax annually, semiannually or as part of your monthly mortgage payments (the tax portion of the payment will go into your escrow account). The local tax assessor’s office can provide you with a specific property tax rate.
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How To Buy A House, In 7 Steps The journey to buying a house can lead you down some perilous roads, past pushy real estate agents, self-interested bankers and not-so-meticulous home inspectors. We lay out a step-by-step approach to help you avoid those pitfalls, from what to look for in a house that will truly make you happy to assembling a team to help close the deal.
This is the day you get your house keys—but first, you have some serious paperwork to do. You’ll set an appointment for closing on your house, and you’ll need to bring your driver’s license, a cashier’s check for your down payment and closing costs (which range from 2 to 5 percent of the home’s purchase price) — and a lot of patience. You will sign and initial dozens of papers.
As a part of active approval, such contingencies must be removed in writing by certain dates which should also have been stated in your purchase offer. However, in some purchase agreements, contingencies are passively approved (also known as constructive approval), if you don't protest them by their specified deadlines. It therefore becomes important for buyers to understand the approval process and abide by taking necessary actions by the mentioned dates.
Moving and other expenses: Moving expenses can vary from hundreds to thousands of dollars depending on how much you’re moving and how far away your new home is from your current place. To help with budgeting, you can call moving companies in your area for quotes ahead of time. If you plan to make updates to your home—like repainting, installing blinds, or buying new furniture—you’ll need cash for that too!
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It’s important to pay attention to a home's aging big-ticket items before you even make an offer. “A lot of homebuyers are distracted by how cute a home can be,” Portales says, adding that she makes it her job to point out the age of the roof, air conditioning unit, water heater and more to buyers. Then when it comes time to calculate an offer, you should factor in the cost of those pieces that will need immediate replacement when determining how much you think the home is worth.


It’s important to pay attention to a home's aging big-ticket items before you even make an offer. “A lot of homebuyers are distracted by how cute a home can be,” Portales says, adding that she makes it her job to point out the age of the roof, air conditioning unit, water heater and more to buyers. Then when it comes time to calculate an offer, you should factor in the cost of those pieces that will need immediate replacement when determining how much you think the home is worth.
Fixer-uppers are all the rage these days, as many homebuyers are willing to take on renovation projects in exchange for a slightly lower price tag. But when budgeting for your renovations, leave plenty of room for the discovery of existing problems once your contractor looks behind the walls. The HomeAdvisor survey found 51 percent of homeowners spent more time on home projects than they expected. “Even if you have a fully vetted, well-reviewed contractor … they still might uncover issues that maybe a previous contractor left incomplete,” Hunter says. He recommends leaving around 10 percent extra space in your budget for surprise problems of any kind.

Need help finding an expert you can trust with such an important purchase? Check out our Endorsed Local Provider (ELP) program. We only recommend real estate agents who close 35 home transactions per year or close more home transactions than 90% of the agents in their market (among other qualifications). Trust me, these pros are the best! Find an agent now!
Wouldn't it be great if buying a home were as simple as it is in a game of Monopoly? All you'd have to do is find a desirable neighborhood, hand the bank a few bucks, and you'd receive a house. Of course, the home-buying process is a bit more complicated in real life (especially for first-time home buyers), but it's not impossible. Competition among buyers in many markets has gotten intense, so if you're serious about homeownership, you'd better get your act together. To point you in the right direction, we've prepared a road map of the home-buying process. From choosing the right professionals to signing that final contract, here are the typical steps you need to be aware of.
Buying your first home can be a daunting task. But millions of people have been there before you and survived. If you do your homework, you'll have the best possible chance of finding a place you can afford for a price you can handle. The big surprise for many first-timers is that they need to finish the first five steps on this list before they can even begin to look for a home.
Seller wants to sell his house and Buyer wants to buy Seller’s house. Buyer isn’t a millionaire, so Buyer needs to get help from the Lender (bank) to finance this big purchase. Lender agrees to give Buyer a loan under certain conditions (these terms are always advantageous to the Lender so the Buyer must read carefully). Seller and Buyer go through negotiations until they reach the most important substantive terms of their agreement (usually this is the price and a few other things). After Seller and Buyer have an agreement in writing, the closing process begins. The Seller and Buyer need to do their own due diligence to make sure that this deal is a good idea for each of them. Additionally, the Lender has to make sure the property is valued as it should be and that the Buyer will most likely keep its promise to pay the mortgage. After all parties involved – the Seller, Buyer, and the Lender – do their due diligence, they can begin to sign papers and transfer the property. However, if there are any hiccups with any of the parties, the deal may be called off. Otherwise, at closing, title to the property is transferred and the deal is complete.
Once you’ve made sure the property is in the agreed-upon condition, you’ll set a date to meet with the required parties. Different areas have different requirements as to who must be present, so you might meet one or all of the following: the escrow or closing agent, the attorney — who could also be the escrow agent, someone from the title company, the mortgage lender, and the real estate agents.
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