Home buyers often go through an approach-avoidance dance when preparing to make an offer to buy a home. Buying a home is not only a huge investment for most people, it’s also a big commitment.

If you’ve been renting, you will no longer have the luxury of calling your landlord when the plumbing breaks down or the roof leaks to get the problems fixed.

If you’re a repeat home buyer, you’re probably already used to the home maintenance drill. But if you’re trading up to a larger home, you may be taking on a much bigger responsibility. That can be intimidating.

The first order of business is to sort out your feelings about making the move. Are you ready for the increased responsibilities? If you’re not, perhaps you should stay put for now. On the other hand, if you continually find yourself straddling the home buying fence, maybe you need to give yourself a nudge. A fact-finding foray could help you make a prudent decision.

HOUSE HUNTING TIP: For some people, it’s useful to make a wish list of all the features you’d like to have in a home. You should also make note of the things you don’t like about your current place. Be sure to check your wish list first when you’re on the verge of making an offer.

You could be attracted to a listing because it has been beautifully decorated. But in most cases, you will buy the house without the furniture. Does the house work for you without the decorations? Home buying involves compromises. But don’t compromise by accepting features that you know from experience don’t work for you.

Ideally, the home you buy should suit your long-term needs. Keep that in mind even if you have friends who recently made a lot of money on a home they bought a short time age. There’s no guarantee that appreciation will continue at its recent breakneck pace.

If you’re new to home ownership, you may have the impression that home prices only go up. But history shows otherwise. During the early 1990s, after a big run up in prices, home prices dropped in many areas. In some places, it took years for those markets to recover.

Before making an offer, make sure that you’re buying in the right location. Recently a buyer found a property to buy that suited her needs perfectly. She made an offer on the property and it was accepted.

However, after a sleepless night, she realized that she could never feel safe living in the neighborhood and she backed out of the contract. Your deposit could be at risk if you back out, depending on how your contract is written. To be on the safe side, spend some time in the neighborhood before you make an offer.

Many buyers in high priced housing markets are opting for potentially risky mortgages in order to be able to buy at all. According to Harvard’s Joint Center for Housing Studies 2005 State of the Nation’s Housing Report, adjustable-rate mortgages, no-down payment and interest-only mortgages all gained in popularity this year.

Interest-only mortgages now make up one-third of all new home mortgages originated nationally. The percentage is much higher in high cost housing markets like San Francisco and New York City. As with any mortgage, there are advantages and disadvantages.

THE CLOSING: Make sure you understand the potential risks involved in a mortgage product you’re considering by asking your mortgage broker or loan agent to present you with a worst possible case scenario.

Dian Hymer is author of “House Hunting, The Take-Along Workbook for Home Buyers” and “Starting Out, The Complete Home Buyer’s Guide,” Chronicle Books.


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