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Monday, January 14, 2013

When Buying A House : Ten Points To Remember

Due diligence in a very simple manner of speaking, would mean, common sense. But when buying A house, one should be very careful in making a decision, and a person must consult experts and those who are knowledgeable what a perfect house really is. Here are some tips:

1. Right Price. Before one goes any further, it is important to know if the offering price is within your budget. If it is, then you have what you can call as bargaining power. Thus, when you haggle or negotiate for a lower price, and you are given the price you want, then at least you would have the satisfaction of having the advantage at the very start of the process.

2. Right Location. More or less, the first question asked is the price when offered a house in a desired location. Usually the offer is general in nature and the details are not yet given. The moment one is attracted with the reasonableness of the price, the next consideration is the right location. Logically, location should mean proximity to the workplace, hospital, school, supermarket, mall, gasoline station, mini grocery, pet shop, clinic, bank, police station, barangay hall, means of transportation, along a major road network, etcetera. But specifically, the house should be in a peaceful, quiet, progressive and prestine community. Close to nature or greener pastures. By the way, it should be flood-free and not within or near an earthquake fault, or any potential environmental disaster such as sink hole, landslide, flash flood, active volcano, or man made risks such as industrial pollution, irresponsible mining, poor planning and corruption.

3. Right House. Do not buy a house which you will later on regret owning. Do not be pressured into buying a house to keep up with the Joneses. Your house must suit your requirements or needs. Check on the materials and paints used, the roof and ceiling, termite and rodent infestation, water source and system, electrical system and connection, firewall and fire escape system, telephone lines, drainage system,

4. Clean Title. Every title over the property has a history. A clean title means that there is no lien or encumbrance, and does not have the markings of any potential litigation. While a buyer in good faith can only rely on what is seen on the face of the title, still it would be prudent to check on the records found at the Register of Deeds, Assessor's Office and the Treasurer's Office. Make sure that ownership over the property can actually be transferred from the old owner to the new one, without any problem.

5. Homeowners or Neighborhood. You would want to live in a friendly neighborhood and not in a community that you will later find yourself complaining in the barangay or entangled in a litigation. Check on the history of a neighborhood. You can inquire with the barangay or from people you know and familiar with the place. By looking at the surroundings, you will initially have an impression of what you are going into. Do not forget the amount of homeowners dues, fees, rates and other charges, monthly and annual. You should also look into the status of the homeowners association, open spaces, potential litigation, and village politics.

6. Site Integrity. It is important that the land over which the house has been built or shall be constructed must not have been consecrated for use as a cemetery or was formerly one before, or it must be free from any dark or grim past. Superstition is not the issue here but respect for what it is intended for, such as a hallowed ground. On another point, it is more peaceful to live in a land which is not haunted by its past such as when it became a dumping site for salvage victims or fetuses extracted as a result of abortions. However, if one is not particular about these things, then go ahead and be a courageous homeowner.

7. Expansion Plans and Restrictions. The adrenalin rush into buying a house has the danger of disabling a person in making an informed decision. Among the points often taken for granted are those pertaining to legal documents and documentation. The fine and unwritten lines are not looked into seriously. There may be restrictions imposed in building improvements on the house such as another floor or extending a garage. One may not dispose of the property for a certain number of years or it can only be sold to a specific person or entity. In other words, if you have plans of doing some kind of alterations, improvements or changes on the property, you have to ensure that they will be allowed.

8. Contingency and Buffer Funds. Buying a house is like buying your own apparel or personal belongings. You would normally have a personal attachment to your clothes, shoes, among others. You need cash to keep them clean, and useable. They need to be laundered, shined, and stored properly against pests. The same is true with houses. You will need cash for minor repairs and maintenance from time to time, and for pest control particularly against rodents and termites. Without any reserved funds for these and other contingencies is certainly a concern. You just do not know what may happen later on.

9. Legal Documentation. The representative of a vendor may not be appropriately equipped with the corresponding authorization. The property may be part of the estate of a deceased person and there may be a need for an extrajudicial settlement signed by all the heirs. Make sure that representatives have their special power of attorney. Find out if there are no lis pendens or other restrictions, liens or encumbrances annotated on the title. If there is any and for one reason or the other, such lien or encumbrance is no longer existing, have it cancelled and removed. It is important that all legal documents will eventually be in your possession and each must have been checked and validated.

10. Overall Property Potential. Overlooked by most homeowners is the need to regularly assess the potential of the property in terms of its current market value and future uses, from residential to commercial or to an upscale residential area. If you are in a subdivision, be particular with the protection or uses given to open spaces against encroachment or idleness, existence and maintenance of clubhouse, sports court, playgrounds and other facilities. All these amenities will contribute to the value of the house and lot.

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