Buying New Collin County Homes

For folks that have been bitten by the new home bug these buyers don't want a used home when a new one is available.  They want a home that has never been lived in and they don't want to move into somebody else's home with worn, dirty carpeting, someone else’s taste in kitchen appliances or look at some kid's initials drawn into once wet cement that they didn't put there. The home must be just built new, fresh and clean without so much as dust on a window ledge or a finger print on the walls.  If this describes you, and you have always fantasized about buying newly constructed of your dreams, here are some tips that can help you to protect yourself and make the process a pleasant experience.

Get a Realtor to Represent Your Interest

·         If your sales contract contains a home sale contingency to sell your existing home before buying your new home list your current home with one of the many professional in your area.  Buying before selling is generally not in your best interest because strong negotiating goes out the window when you've emotionally moved out of your home.

·         The builder has sales agents that are paid to represent them.  Many of them use high pressure sales tactics to persuade you to sign the contract. Due to the high volume nature of selling new , many builder's agents are paid less than traditional real estate agents; some earn salary plus commission incentives, so turnover is important to their livelihood.

·         You will fare much better if you hire a buyer’s agent to represent you.  Most of the time, your buyers agent will be paid by the seller.  If you pay your agent directly you can probably add that fee to the sales price, and it would be worth it because a good buyer's agent can save you thousands more than the commission.

·         Your buyer’s agent will represent your interest only.  He or she is required to disclose the positives as well as the negatives about the transaction. Builder's agents won't discuss drawbacks.

Obtain Competent Legal Advice Before Buying a Brand New Home

·         Before you sign any sales contract, talk to a real estate lawyer. Standard real estate purchase agreements are designed to keep everybody out of court, but they don't necessarily contain language that protects the buyer.

·         Ask questions about removal of contingencies and your cancellation rights, if any.  Make sure you understand your liabilities and commitments.

·         Check to see if building materials used by the builder contain chemicals that are hazardous to your health. If your contract contains a warning about health issues, it's probably because it's a valid concern and other buyers have gone to court over it.

Don't Just Automatically Go With the Builder's Lender

·         Most builders prefer to have you use their lender because the builder will be kept fully informed of the progress of your financing.  But keep in mind that a builder's lender might not offer you the best loan terms and rates.  Also, the builder may own the lending company.

·         Consider other sources to find a mortgage lender. Your own regional bank or credit union might offer you great rates and terms, based on your banking history with that institution. Your buyers  agent may refer you to their private list of preferred lenders.

·         Shop around and interview lenders. Find a banker or mortgage broker whom you can trust and with whom you feel comfortable doing business.

·         Ask to see a copy of your credit report and credit scores. You can also order your own credit report for free before shopping for a new home.

·         Insist that your lender guarantee its good faith estimate numbers. If the lender balks or makes excuses, go elsewhere, because reputable lenders will honor that request, even though it's not required by law.

Choose Options and Upgrades                                                              

·         Determine which upgrades and options you want.  Keep in mind that for many builders, the profit margin is high in the options and upgrades. Many builders can sell a home for the construction cost because they make the bulk of their profit in the upgrades.

·         To save money, consider which upgrades you can purchase and install yourself after closing. However, realize that some upgrades such as security wiring inside the walls are easier to do before construction

·         Find out whether your lender will lend on all the options and upgrades you have chosen. If your lender will not finance 100% of your selections, you will be required to pay for it in cash.

·         Ask about cancellations and whether you will be held liable for items the builder cannot return to a vendor.

·         Some contracts give the builder the right to choose your upgrades if you do not submit your request within a certain period of time.

Research the Builder's Reputation

·         Find out whether the builder sells their houses to investors. Many builders require all their homes to be owner occupied. Others eagerly sell as much inventory to investors as profit margins will allow. If the market suddenly dips, investors are typically the first to bail and, besides, part of the reason you are buying in a new subdivision is to be surrounded by other buyers just like you, not renters.

·         If a buyer has a bad experience with a builder, the word spreads quickly throughout a community. But you won't know if a bad rep is an isolated experience or if the builder repeatedly brings bad publicity to itself without checking and verifying the lawsuits in the public records.

·         Talk to your future neighbors and scrutinize the construction quality of surrounding homes. Is the builder consistently building identical or larger homes in the area or is construction lagging and homes getting smaller in size?

Yes - Hire a Home Inspector

·         Used or new, always, get a home inspection before you buy a home.  Hire a licensed and accredited person to complete the inspection.  Don’t use your dad or your buddy contractor, get a real inspector.  Make sure you are there for the inspection and ask questions because a new home can contain defects. The HVAC system might be too small or the plumbing could be installed incorrectly.  Construction workers, like everyone else, make mistakes.

·         If the inspector calls for further inspections by other professionals or contractors, find out if the inspector is telling you there could be a serious issue or if the inspector isn't licensed to address that issue.