Lots of real estate websites put importance on doing due diligence prior to placing an offer. What is “FHA” anyway?
Despite sounding like a term you’d commonly hear on a legal drama, “Due Diligence” is simply the act of investigating prior to signing a contract. Common sense dictates that “Due Diligence” is an important part of any sales process. So let’s look at the things you should do due diligence on before signing any contract.
Always look into HOA fees and taxes. If you are going with FHA financing, then the importance of conducting due diligence regarding HOA fees and taxes could not be stressed enough. If the monthly fees and the tax rates are too high, you might eventually find yourself in default. You should find out how much you’ll be paying for including the fees then start negotiating the sales price with the seller. It may seem like such a hassle but some loans have been denied because of high HOA fees.
When it comes to good deals, there’s always a catch. Sometimes, you’ll find a home for sale and the deal offered would be too good to be true. More often than not, it IS too good to be true. If you find an enticing house that’s been on the market for a long time, have your agent do some research regarding the home’s sale history. You need to look for pending sales that didn’t go through and you need to find out why. Do your due diligence in these instances and keep yourself out of a sticky situation.
Don’t let a house blind you. A home might seem to be the perfect fit and in the moment you will fall in love as soon as you step through the threshold. Maintain a level head at all times and focus on the deal before you start negotiations. Compare the home’s listing price to the other homes in the area which have been sold in the past 6 months at least. Make an offer that does not exceed 10% of the fair market value.
These are simple, practical ways to keep you out of serious real estate trouble. Understandably, you’d be excited once you find the home which you think is “the One” but keep in mind that it is Due Diligence that will keep you free from future headaches.
And to truly get the deal you more than deserve, you should get the services of a great real estate team that you would be able to depend on to do your due diligence and more! Trust in the expertise of the Great Florida Homes Team!
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