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Don't Make An Offer Without Asking These 5 Questions

House hunting can bring out the indecisiveness in all of us. You love a home, but it’s a tad expensive. The location is perfect, but you’re not sure about the pink carpet. So how do you know if you’re ready to make an offer? Ask yourself these five questions to tamper down the uncertainty on your house hunt.

Does the Home Fit in my Budget?

It’s very easy to become “house poor.” “House poor” folks spend a large portion of their income on a home, and have little cash to spend on other items. A dip in income or emergency expenses can be catastrophic for those who overspend on a house.

Don’t make that mistake. Ensure a home fits in your budget with this two-step process:

  1. Preapproval. Go through the preapproval process with a lender. Preapproval estimates the size of loan you can handle, and calculates your monthly mortgage payment.
  2. Practice your mortgage payment. Once you have a target mortgage payment, practice that payment for at least three months. Here’s how: If the payment is more than you’re currently spending on housing, place the difference in a separate account. If the additional expense is easily manageable, you’re probably ready to make an offer.

Am I Paying More for a Home Than It’s Worth?

Over the years, the percentage of Americans with "underwater" mortgages wavers around 10 percent. That means that millions of homeowners owe more on their mortgage than their home is worth.

The lesson? Be cautious. Hire an agent whose advice you can trust, and use the prices of comparable properties (or “comps”) to determine a fair market value. Don’t go above that value. Your financial future will thank you.

How is the Location, Location, Location?

One thing that you can’t change about a home is its location. To assess a home’s location, ask yourself the following questions:

  • How close is the home to work/daycare/school/family/shopping?
  • Does the neighborhood feel like a good fit for my family?
  • What is the neighborhood like at different times of day?
  • Is this a drastic change from my current location? If so, am I ready for that change?
  • If I were choosing a home simply based on location, would I choose this home?

If you’re cringing in response to any of these questions, you might want to rethink your offer.

Do You Know How Much Work is Needed?

Don’t underestimate how difficult and expensive home improvement can be. Before making an offer, carefully assess the home’s condition, and estimate how much additional time and money you’re able to pour into it.

And always make your contract contingent on the results of a professional home inspection. A home inspector will itemize a home’s major problems and recommend certain repairs. Buyers can get professional estimates for those repairs, and use that information to renegotiate the purchase with a seller.

What is your Gut Telling You?

Are you jumping up and down after a private showing? Are you already picturing yourself as the home’s owner? Does everything feel right?

Your subconscious has a way of pulling together information and channeling it into a certain emotion. If that emotion is pure excitement, you may have found the perfect home.

Trust your instincts. If a home fits within your budget, meets your location needs and you can’t imagine living anywhere else, you’re probably ready to make an offer.

If you have questions about making an offer on a home or need help finding a VA-savvy real estate agent, talk with a Veterans United Home Loans specialist anytime at 855-524-7279.

About Our Editorial Process

Veterans United is recognized as the leading VA lender in the nation, unmatched in our specialization and expertise in VA loans. Our strict adherence to accuracy and the highest editorial standards guarantees our information is based on thoroughly vetted, unbiased research. Committed to excellence, we offer guidance to our nation's Veterans, ensuring their homebuying experience is informed, seamless and secured with integrity.

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