First-time homebuyers can be challenging clients, as they’ve perhaps been engrossed in “DIY” TV shows or are otherwise under the impression that a rehab project is the way to go for their first home.

I once had a nice young couple who was purchasing their first home. They weren’t married yet, and the young gentleman was a carpenter’s apprentice. Of course, the soon-to-be-bride was beaming with pride that her fiance could fix just about anything!

The first home we looked at needed extensive work. Upon arriving at the property, and before we even went in, she announced that they wanted it! Needless to say, her fiance looked a little ill when we exited and he said even he “wasn’t that good!”

Advising your first-time homebuyers is crucial to not only a successful sale but also a happy client who will come to you for all their future real estate transactions.

Purchasing a “money pit” unawares will not only put their financial stability in jeopardy, but may leave them with the impression that you did not advise them properly!

Here are five tips you should consider beforehand:

  • How are you paying for this home? If your buyers are getting a mortgage for their new purchase, make sure the loan fits the product. There are only a few lending products that will allow for a rehab project, and even less that will allow them to do the work themselves. Ascertain their financial situation before even showing them properties. A “fixer” may not even be within their capabilities. If a family member is helping them with the cash, make sure the buyer is including the “money man” on the tours and in the decision.
  • Get past the ugly! Have your buyers make a list at each home what they would want changed, what must be updated and what they believe the lender will require. Remind them that “ugly” doesn’t mean obsolete. Many homes owned by senior citizens may need a lot of updates, but in many cases the “bones” are in great shape, such as the heating system, roof, electrical and plumbing. Perhaps their tastes are decades behind the curve or they’ve just been more concerned with mechanicals than aesthetics.
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