Things to Consider When Buying a Home


Things to Consider when Buying a HomeThings to consider when buying a home in Northern Michigan

Most financial experts are saying it’s a good time to buy a home, provided you are going to live in the house for five years or more. If you are making a commitment to homeownership in Charlevoix or greater Northern Michigan, here are some things to consider.

Before you even start shopping, get prequalified or preapproved with a lender. Even if you have a long-standing relationship with a certain bank, this can be a good time to shop around. While your own bank may be your best bet if you don’t get the results you want when you talk to their mortgage department, you still may have options. (Your Realtor may also be able to recommend lenders)

Getting prequalified for a loan means your lender has done a review of your credit to determine if you're likely to be qualified for a mortgage when you officially apply. Getting prequalified allows you to see if you may be approved for the loan before you have the bank run a hard pull on your credit. 

When you're preapproved, you receive a letter from the bank showing you are highly likely to be qualified for a mortgage for a certain amount. You can then take that letter to your Realtor to show you are a serious buyer. Preapprovals require an in-depth look at your financial state. Preapprovals are regarded as more serious proof of your ability to purchase a home. 

You will typically need:

Hold off on anything that would require someone to run a credit report on you, such as:

When you run your credit for cars, insurance, credit cards, or other various reasons, it may negatively affect your credit. Having a credit score in a certain range is important for securing your mortgage and securing the best interest rate. If you change your credit limit or agree to additional debt such as a car loan, you're changing your debt-to-income ratio, which may also affect your ability for your purchase to make it through closing. 

Choose Local to Northern Michigan

We highly recommend working with a local lender. Lenders local to Charlevoix are familiar with the real estate market in the area and communicate much better with your real estate agent because they are tied to the community. Benefits of using a local lender include the following: 

Many lenders, especially lenders in Northern Michigan, dedicate a lot of time building relationships with Realtors in the area. When you are working on purchasing a home, you want the process to move smoothly and efficiently. When your Realtor and lender are working nearby, everything flows much more harmoniously. Your closing will likely happen much sooner when using a lender from the Northern Michigan area. 

Lenders in Charlevoix and Northern Michigan know the nuances of the area. They are prepared to navigate the situations that may arise when you're working on closing on your home. From property values to neighborhood culture to the local economy, local lenders are familiar with the circumstances you're working with when purchasing your home. 

When you work with a lender local to the Northern Michigan area, you're able to communicate with them face to face. You'll have a direct contact number to reach your lender, and you can often walk into the office to chat with them if an urgent matter comes up. This experience is a lot less stressful than waiting on hold with a large corporate lending company. 

When you work with a local lender, you often receive local benefits. In addition to local knowledge, local lenders often offer bonuses such as free pre-approvals, saving you some cash over your purchasing process. 

When you choose a local lender, you can look for one that has proven to be successful. Lenders local to the Northern Michigan area have a vested interest in your success because they share the same community with you. 

Benefits of choosing Pat O’Brien & Associates

When you work with a local Realtor, we can help you through all the bumps that purchasing a home presents. We are aware of market values, which is helpful to maneuver potential appraisal pitfalls. Let’s say you have made an offer on a home, and the seller has accepted your offer. Now it’s time to have an appraisal – and there are a couple of potential snags. The appraiser may not be familiar with the local market and/or the appraisal may come in below the accepted offer. These are not necessarily deal-breakers, but you should be aware of all potential setbacks.

If the property you want needs third-party approval (IE: a short sale), we will be here to provide extra support. It can often be a long process fraught with frustration, but if you have a good Realtor and keep your end goal in mind, it is often well worth the effort.

Home Inspections

While inspections seem like another added expense, they are worth the investment. A licensed inspector will check the roof, wiring, plumbing, heating and cooling systems, insulation, well and septic looking for mold, etc. The average homebuyer is unqualified to identify associated problems. Building in a clause that has your home sale contingent upon inspection is a wise idea, and your Realtor should recommend it.

Having said that – an inspection is not a win/lose proposition. A buyer may elect to still purchase the home and may negotiate with the seller to make repairs or reduce the cost of the home. Or you may take advantage of the contingency clause, retain the earnest money deposit, and resume shopping.

We understand that buying a home in Northern Michigan can seem overwhelming and that's exactly why we are here to help. It's our job and we love it!

The Community

When buying a home in Northern Michigan, you want to be mindful of the community you’re moving to. Some things to consider in the community:

If you have a family or you’re planning on having a family, it’s important to consider the school district you’re moving to. Does it provide the education and extracurriculars that your family needs? What is the school ranking and performance like? Will the culture of the school district fit in with your lifestyle?

What activities, clubs, and religious organizations are important to you? You may want to consider how your life will fit into the culture of the neighborhood you’d like to move to. Evaluate what the community offers, and ensure it aligns with what you value.

Do you like the hustle and bustle of the city, the whisper of a quiet subdivision, or the solitude of a house in the woods? Activity level is an important aspect to consider when choosing the home that is right for you and your family.

Seller's Incentive

When purchasing a home, something to consider is why the home is for sale. Perhaps the current owners outgrew the home, or they're moving for work. They also may not enjoy the neighborhood, or maybe there's something wrong with the house. Perhaps the home is outdated. The reason the home is for sale is important to know because you don't want to find out after you sign the papers that those reasons are going to make you unhappy in that home as well. 

Wherever you are in your home buying journey, Pat O’Brien and Associates are here to help you find your dream home in Charlevoix and greater Northern Michigan. Contact one of our agents today to start your search!