You probably have already heard the usual home buying tips. Here are three that aren’t as common.
Home Buying Tip #1 – Buying A House Isn’t Always The Best Plan
Of course real estate agents may say that buying a home is always a good idea. It certainly is good for them, as well as for title companies and bankers. But it isn’t necessarily a good idea for you.
Believe it or not, there are towns where the home values haven’t gone up much – if at all – in ten years or more. Of course in the last year (this is being written in 2007) the prices in many areas have actually dropped in value. The point? Home values do not always go up – at least not in a given year or even several. So don’t buy a home as a get-rich plan.
Maybe you are sure that prices will rise where you are. Even then, though, a home isn’t necessarily a good investment, if rents are low relative to home prices. In Tucson, Arizona, for example, a two-bedroom home might sell for $190,000, but you can rent one for just $750 per month. If you spend $700 less each month versus buying, and bank that money, you could be further ahead financially three years from now.
Consider how long you’ll be in the home. This is important because of transaction costs. Buying and later selling your home can cost 10% of the home value. It will have to go up that much in value just to even break even. If you move in the first couple years and prices have gone nowhere, you’ll end up thousands of dollars further behind.
Home Buying Tip #2 – A Real Estate Agent Is Not Your Friend
Even if your agent actually is your friend, she won’t necessarily look out for your best interest. In fact, she can’t, if she is working for the seller. Unless specifically is working as a buyer’s agent, she is legally obligated to work for the interest of the seller. The seller, after all, is the one paying the commission. If you say something like “I might go $5,000 higher,” she is obligated to pass on this information to the seller.
Even with a buyers agent, be careful, because people talk – even good agents. Don’t say things you don’t want known by all. Also keep in mind that agents make money only when there is a sale, and they make more on larger sales. This might mean less than perfect objectivity when helping you choose a home.
Home Buying Tip #3 – Low Offers Sometime Work
The real estate agents out there won’t appreciate this tip, because low offers are embarrassing for them to bring to a seller. It may even be embarrassing for you to make the offer. However, I have a friend who embarrassed himself into a lakefront home for 15% less than it was worth. Would you like to immediately increase your net worth by $40,000 when buying a home?
Here’s how low offers work: rarely. You’ll let many nice homes get away, you’ll spend a lot of time making offers, and you’ll annoy real estate agents. However, as long as you don’t have time constraints, or the fantasy that there is one “perfect” house for you, making low offers can be a good way to save money. But here’s one last home buying tip: If none of your offers even get you a counter-offer, you may really be wasting your time and trying to go too low.
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{ 29 comments… read them below or add one }
Hi, I found the information listed very heplful for me as a single mom of 2 girls. I am looking for more information for 1st Time home buyers for single moms.
I’m glad everything was so helpful to you, and we do have plenty of articles to help you out with this! Take a look here for a whole bunch of information that has to do with housing. There’s a couple of articles on government help for first time home buyers who are also single mothers that might be particularly helpful.
hi the website for a single mother i fund is very interesting for a single mother as one of them i asking if they dont have any help for 1st time home bayer
There are quite a few great articles about home buying here that I think could be very useful to you!
i will be more than happy if you respond to me. thank you
Hi. Is it really true and proven that it is better to buy a rent to own a condo than buying a new house than ? I am a single mom and I am working really hard right now just to buy a new house. What help can you give for me to make the right decision to have a new home for me and for my 5 year old kid?
I have 5 autistic children. I have found the perfect house for us. But I don’t have a job. I’m always overquqlified. I have good credit. They are asking 42900 for it. I want to be near my sister who could help with my kids. Its hard 2 keep ajob when your constantly having 2 take off or leave because of something that happened 2 one of them. I was told by the agent that someone put in a bid for the same house. But its not concrete. So please I’ve put this gods hands now to help me . Hopefully you will be 1 of his messengers ready to hand over what I need to get this house. I thank you for your time . God bless you and have agreat day.
Most single mothers programs for homes are run by the government, have much stricter guidlines, and I don’t think they would be quite what you are looking for. There are some, however, such as Walls of Hope or the Salvation Army, that offer private assistance to mothers looking to buy their home. The private organizations are more about offering money to assist with getting the grants and loans you need, such as offering a down payment for the loan. Try looking at their programs and seeing what they can do for you.
I thought I’d add in on some of the options for home loans. There’s something called a Rural Development Loan, which is pretty much renting a house for sale from the government with option to buy. You basically pay next to nothing on the payments but you can fix up the house and if you turn around and sell it, you keep any profits after paying off the balance. My sister who is a single mom was able to get a 3 bedroom home that was over 1500 sq ft and opened up a daycare. She’s now debt free, has upgraded the home and is living like she’s always dreamed.
These homes are only offered in rural areas, not cities like Chicago or Atlanta, but worth the look for those who are in need.
hi Candice.. where can i find info on this?
Hi Stacie, here’s a link for more information…
http://www.rurdev.usda.gov/HAD-Direct_Housing_Loans.html
You can also talk with a Realtor about this type of loan, they should be able to help you with more details. My sister did have an apartment before she applied for this loan, and it was adequate housing, so I’m not sure what they mean by adequate, or what their idea of adequate is.
After locating your state, you can call the number listed for the area you are interested in and they will be able to answer more questions for you as well.
I need help I am a single mom with two kids, the dads do not assist me no matter if I have a court order or not and I am barely scraping by most days. I need some major help if anyone knows of something that could help me buy a house and make ends meet I would greatly appreciate it. Thank you.
Have you tried checking out this website? http://www.singlemomfinancialhelp.com/assistance/state/
I popped in here to educate myself about programs for future Buyers. I was so disappointed to see the section titled “Home Buying Tip #2 – A Real Estate Agent Is Not Your Friend” Such a narrow, one sided view. First of all what you have described is called Dual Agency. It is not always allowed because of difficulty sometimes with what is discussed. I have personally and successfully closed several transactions acting as a dual agent. In that position, I cannot divulge any information to either party that could negate their negotiating position to get the best purchase price that works for both parties. It is unethical and can have serious repercussions ranging from fines, lawsuits, and loss of license.
Rather than bashing ALL Realtors, you may want to suggest that they interview 2-3 that they have researched…length of career, areas of expertise, a license free of any blemishes (can contact their state commission), and a positive enthusiastic attitude.
I closed a single woman in December, in a beautiful foreclosure, with little money down, at $10,000 lower than the price SHE originally wanted to bid, but I advised her to go lower.
The Bank performed the appraisal, that came in $20,000 higher than the purchase price, which equals EQUITY. She has a home, in a down market that already has $20,000 in equity…she’ll be sitting pretty when things swing back around.
Anyway, I’ll get off my soapbox. I just wanted to re-iterate that the world is NOT full of predatory agents. I have completed my 10th year in Real Estate and I VALUE my clients and customers and act in THEIR best interest at all times. I have a great referral network and very proud of my accomplishments. There are amazing, professional, ETHICAL, Realtors out there who will not only assist you in any way possible, but might also become YOUR FRIEND in the process.
i am finaly buying my first home, the only one in my family to do it, and im 33. its not a bad price and the payments are as if I am renting. big problem though, everything needs to be redone, from the ground up. I am even trying to renovate my back room into 3 bedrooms. its extreamly hard. I never seem to have the extra cash. I keep getting supplies little by little but then other things pop up. ive been here for almost a year and I feel like I havent accopmlished anything.
Anna,
Good for you. I know it is extremely hard doing it on your own. Just keep plugging away with what you are doing, taking one day at a time. You will get there. Although, there is help out there, for single mothers, for purchasing a new home, sadly there is no help that we have come across for renovating. But you may want to check into some of your local High Schools or Vocational Schools that offer construction classes. They may offer credits to students in exchange for helping you. They might be able to help. All it takes is a phone call. The worse thing that can happen is they so they do not have programs like that. If I come across some renovating help I’ll let you know. Good luck to you and keep up the good work.
Single Mom Support Team
I’m not sure what your income is but when I was just answering another post I happened to come across this…
http://www.rurdev.usda.gov/HAD-RR_Loans_Grants.html
Maybe you could benefit from it, or at least be able to get one area of your house done, pay it off and start on another?
Thank you for the idea, but unfortunatly you must be 62 or older, and currently speaking im nowhere near that. But thank you for reading and responding
Hi i was wondering is it possible to get help buying a home for the first time as a single mom. I have 5 children and currently reside in a trailor it is a little small for my family size. I also do not wish to live in this area any longer. I only recieve child support as an income of $200 per week. I was told by some friends that I would qualify for some sort of help with loan, I could sell my trailor for the downpayment its probably worth about $4,000.00 I hope. Any help would be great, I have been trying to look through the websites but am having a hard time understanding them.
Hello,
you can contact HIP which is the housing initiative program that help provide homes
and being a single mother you can receive housing grants.
Hope this helps!
Ok I am a single mom that works full time, I am in the house we were in as a married couple. However, after 5 years of struggling to make ends meet I am contemplating moving to an apartment. Most apartments in my area aren’t much less per month than my mortgage, the only relief would be that I would not be responsible for a yard, up keep and maintenance on a house. Someone suggested that I see if I could refinance, I know nothing about this process and since my divorce 4 years ago my credit is awful. I am trying to find resources to help me decide if it’s better for me to stay in my home and continue to try to make it work, to try and refinance or to move into an apartment until a later date. Any advice or information would be a hugh benefit. Thank you!
Hello,
Being a single mom you can receive Financial Grants as well as Housing Grants For Single Moms.
I hope this information is of assistance to you.
Thank you Sydney,
I will look into this information. The issue I run into alot with my mortgage company is that my debt to income ratio is too great. And I want to say “Duh, that’s why I’m trying to lower my mortgage payment because it is the most important to me and I want to make it each month without fail”
MY NEED IS 130,000 USD TO BUY A HOME.
Hello!
You can receive housing grants for Single mothers.
Hope this helps!
how do i get to keep my home even when its in foreclosure but not yet went before a judge? i went through a divorce 4 years ago and got my home,but mortgage company decided to foreclose in nov 2011, even when i could make payments only if they would lower interest and reduce payments. they had been modifing the loan because of my income but then i started receiving child support and then they wante to fore close. i want to keep my home,ive lived here for 7 years,and it will cost me too much to move, the loan was under fha and wells fargo, i was a co-borrower on the loan,can anyone let me know what to do!
Hello,
Being a single mom you can receive Housing Grants,
if worse comes you worse, you can contact HIP which is the housing initiative program that helps provide homes.
You can even look into receiving state assistance.
Hope this helps!
Hi, I live in South Africa. Do we also have housing grants? I have 2 daughters a grandchild and took in a girl who`s mom just left her alone in a flat and moved away.
You might want to check with the government or any other place who can provide help financially. Most of the information in this website is only for the U.S, but surely there are government ways you can receive help as well.