Getting Started
1. Do not assume buying an existing home is cheaper
than a new home. The new home market is highly competitive and it is a buyer's
market. Plus, new homes generally have lower maintenance costs, are more energy efficient,
safer, healthier and have a longer life expectancy than existing homes.
2.
Do not waste your valuable time looking at properties
in areas where you will be unlikely to build. Before beginning your search, narrow
your focus to the areas that have the combination of schools, tax rates and services that
fit your lifestyle and pocketbook.
3.
Do not underestimate the size home you will need.
Consider how long you intend to be in the home. Then plan and anticipate any family
or lifestyle changes that could affect today's decisions.
4.
Do not go shopping for a new home without first having
a firm idea of how much home you can afford. Obtain a home loan pre-qualification or
pre-approval from a reputable lender to determine a realistic price range for your new
home. The assistance of a home loan professional helps make sure you are aware of all the
costs involved in the process, not just what your monthly payment may be.
5.
Do not overextend your budget. Just because
you are pre-qualified up to a given level does not mean that you will be
comfortable with the required payments. Write down everything you have spent for a two- or
three-month period. Then plan for emergencies, savings, vacations, home upkeep and any
other expenses you may see on the horizon. You will then have a much clearer picture of
your monthly payment comfort level.
6.
Do not begin your search
without strengthening your negotiating position. Home loan pre-qualification or pre-approval from a
reputable lender is an indication to builders and agents that you are serious about buying
a new home. And it gives you the confidence of a "cash buyer" when talking with
builders.
7. Do not assume
all home loan financing is the same. As the buyer of a new home, you need financing that
protects you against rising interest rates during construction. Ordinary home loans
provide only a 45- or 60-day standard interest rate lock. This leaves you dangerously
exposed to the threat of a higher interest rate at loan closing - and higher monthly
payments than you budgeted.
To obtain the added interest rate security you need during construction, you normally must pay a higher
rate or extra points. However there are alternatives.
For example, ProLoan lenders provide free 6-month rate locks.
Making Your Selections
8.Do not hesitate to
ask every question that occurs to you. You are not expected to know everything about buying a new home.
Write down questions that pop into you head at odd times so you'll remember them when meeting with builders.
A new home is potentially the biggest purchase you will make in your life - the only "dumb" question is
the one that isn't asked.
9.Do not assume that all the features you see in
display homes are standard. Display homes usually contain many options. Asking
questions to determine which features are standard will help prevent misunderstandings and
disappointments later on.
10.Do not rush the builder-selection process.
Make your decision only when you feel comfortable. Check competing builders'
professional credentials. Membership in a professional group can indicate a
builder's interest in the community and the industry. Plus, professional associations
provide their members with valuable information that keeps them up-to-date on building
materials, equipment and innovations so that home buyers may receive the greatest
value for their money. Also check for any outstanding complaints against the builder
with the Better Business Bureau.
11.Do not overlook the advantages of buying a union-built home.
Unlike non-union workers, skilled union craftsmen receive extensive training while serving
an apprenticeship under the supervision of an experienced hand. They are dedicated
craftsmen who have made their trade their career, not lust a job. And they take
pride in maintaining the quality reputation they've earned. As a result, you get a higher
quality, better built home.
12.Do not forget to ask about warranties. New
homes usually come with a one-year warranty on materials and workmanship, and manufacturers'
warranties on appliances and systems. Plus, many builders
offer insurance-backed structural warranties for up to ten years.
13.Do
not select a new home with a base price at the top of your affordable price range. There
are always extras that you will need or wish to have. Allow yourself a reasonable
cushion for extras so you will not be financially squeezed or disappointed with the
finished product.
14.Do not assume that a floor
plan cannot be changed. You might, for example, think a floor plan would
be right for you if only it had an extra bedroom or a larger family room. Talk to your
builder who often can adjust floor plans to meet your special needs.
15. Do not overlook the
details of exterior finishes.
* Before deciding on the location of outdoor walkways, try to imagine their use - this can save many a beaten path across
the lawn.
* Consider an expanded driveway if you have larger cars, driving-age
children or anticipate a lot of company.
* Make sure exterior porches and decks will be adequate if you
anticipate entertaining extensively.
* During construction is the best time to install additional
drainage to downspout areas, reels for hoses, and irrigation systems for the lawn and garden.
16. Do not shortchange yourself on interior details.
* Give careful consideration to convenient,
eye-appealing and adequate placements of electrical
and phone outlets.
* Consider special needs such as computer hookups or additional power tool outlets and
other accommodations in your
work spaces.
* If you are considering finishing the basement at some point in the future, plan the
layout now to allow adequate ceiling
height and rough in the plumbing - this can save big dollars later.
* Don't overlook installing adequate shelves and racks in storage areas - they are
easier to install during construction than when the space is filled with odds and ends.
17.Do not downplay the practical side of interior design.
* Will your flooring and floor covering match your family's lifestyle.
For example, do you really want light-colored carpeting with small children and a dog?
* Will countertops camouflage spills and simplify cleanups?
* Will wall treatments permit easy cleaning and maintenance?
* Will lighting fixtures not only provide adequate light, but also the
right type of light, especially in critical areas such as bathrooms and kitchens?
Assuring A Smooth Process
18.
Avoid being adversarial or contentious with your
builder. Unlike an existing home, a new home allows you to get just what you want.
Because that involves many details, things can happen that do not meet with your
satisfaction or expectations. Developing a good working relationship with your builder
through frequent, open communications will help resolve issues quickly, allowing
construction to proceed smoothly. Take notes of your conversations and get verifications of
changes in writing to ensure clarity on behalf of both parties.
19.
Do not rush your walk through inspection or feel that
you are being too critical when it comes time to check everything in your
new home. Allow adequate time to carefully look at walls, countertops and other surfaces,
and inform your builder in writing of any scratches or nicks. Because these can easily
occur as you are moving in, they are often not covered under warranty.
20.
Do not miss the opportunity to enjoy the process. Track your
new home's progress. Take pictures of it and the neighborhood as it is being built.
Meet your new neighbors. Remember that you're not just buying a new house, you're building
a home.
