Over at AskMetafilter, somebody recently wrote:

What is the single most valuable piece of advice you received when you were in the process of buying your home?

Among the great advice in this thread are gems such as:

  • Don’t go into debt to furnish your home.
  • Get pre-qualified for the mortgage so you know how much you can work with…Then only spend 75% of what you’ve been pre-qualified for.
  • Buy the worst house on the best street or neighborhood you can afford.
  • Explore the neighborhood. Talk to the neighbors. Ask yourself if this is someplace you could live.
  • Take your digital camera with you while touring homes.
  • The closing date in the contract is meaningless. Don’t schedule movers or break leases, etc. until the official closing date is set.
  • “Make a ridiculously low offer, because you can never negotiate downwards…I made the lowest offer I could bear, which saved us about 10% of the cost of the house.”
  • “If you are bidding for a house among other potential buyers, write a one-page letter stating why you would really like to buy the house. The seller of my current home said it swayed his decision (we wrote a cover letter about dreams of raising our daughter with a big backyard).”

Kris and I have purchased two homes now. The first time, we purchased directly from the seller. The second time, we rushed into the purchase because we had found our dream home. Neither process was “typical”, but we learned a lot. Our advice includes:

  • Make a list of priorities. What’s most important to you? A big yard? Proximity to shops and services? Privacy? A large dining room? Each person wants something different. When looking for our first house, we found it valuable to make a list of the things we were seeking. Without a list, it’s surprisingly easy to forget something important.
  • Buy less than you can afford. I used to subscribe to the notion that a person ought to buy as much house possible. If the bank wanted to give me a loan that would take 30% of my income, I was happy to pay that. With the benefit of hindsight, I’d rather have a smaller payment.
  • Budget for post-move expenses. There are always unexpected situations that arise. Maybe the water heater needs replaced, or the furnace needs repaired, or the windows are painted shut. In an ideal world, you’d catch all of these things before buying the house. In reality, I don’t know a single person who hasn’t been faced with unexpected problems after moving in. Plan for this, and set aside some money to deal with the unexpected.
  • Put down as much as possible. Many people swear by the 20% down rule-of-thumb. It’s true that a large down-payment can reduce monthly payments and eliminate private mortgage insurance, but we didn’t have 20% saved for either of our houses, and we’ve done just fine. Save as much as you can.

  • Pay for a high-quality inspector. Don’t just pick somebody from the phone book. Ask your friends, co-workers, and neighbors for recommendations. A top home inspector can save you thousands of dollars, spotting problems you might not have otherwise noticed. What’s more, his inspection report can serve as a home-improvement agenda for years to come. (In the AskMetafilter thread, one commenter suggests taking the inspector out for drinks after he’s looked at your home. I think this is clever.)
  • Do as many improvements as possible before you move in. We didn’t do this at our first house, so we lived with minor annoyances for years. In our current home, we did a lot of work before we occupied the house. Don’t tell yourself, “Oh, we’ll paint the walls next year.” You won’t. Do it now.
  • Read the paperwork. Read all of it. If you’re buying the home with somebody else (such as a spouse), either tag-team the reading or both read everything. Too many people skip this step. Your mortgage is one of the most important documents you will ever sign. It will control your life for years (up to three decades!). I don’t care how cranky the loan officer or the real estate agents get — read every document, and ask questions if you don’t understand.
  • Keep contact with the previous owner, if possible. Not all sellers are open to this, but many are. We maintained contact with the sellers of both our homes, and are glad we did. We were able to get information about the whys and wherefores of particular “improvements”, as well as tips about certain systems in each house. This isn’t a license to be a pest to the former owners; it’s just a way to draw on their knowledge when needed.
  • Don’t rush anything.

Everyone who goes through the process of buying a home knows how emotional the process can be. This is the largest purchase most people will ever make, and it’s easy to become a nervous wreck that you’re making a bad decision. The more advice a person can have, the better.

[AskMetafilter: Chunks of homebuying wisdom from The Hive Mind]