A Guide for First-Time Homebuyers: Questions to Ask Your Realtor®

Buying your first home is an exciting journey, but it can also be overwhelming. To help you navigate the process smoothly, we've compiled a list of essential questions to ask your Realtor®. These questions cover various aspects, from property appraisals to the Realtor's adherence to a code of ethics. Let's dive in!

1. Understanding Property Appraisals

When it comes to buying a home, understanding property appraisals is crucial. An appraisal determines the fair market value of a property, influencing your financing options. Ask your Realtor about the appraisal process and how it can impact your home purchase. This knowledge will empower you to make informed decisions and negotiate effectively.

2. Exploring the Code of Ethics

It's easy to assume that your Realtor doesn't want to give you bad news, but it's a matter of what's considered "material fact" and what isn't. Robyn Bipes-Timm, President of TCHFH Lending, Inc., says material fact includes "anything that might substantively affect the buyer's decision" –information like house age, condition, what defects it might have, or whether or not it's been remodeled in the past.

Licensed real estate agents become Realtors by joining the National Association of Realtors^®. Real estate agents are bound by a Code of Ethics, which includes guidance on what information can be ethically shared by a Realtor with their client. They're required to take training and certification courses regularly to make sure they know the current standards and how to apply them when helping clients buy and sell homes. "It makes sure they're acting in legal ways and responsible ways," Robyn says.

The Code of Ethics also outlines things Realtors shouldn't do, like blockbusting (using misleading information to scare clients into selling their homes) and steering (the illegal practice of incentivizing a client's buying decision based on characteristics of the buyer, seller, or neighborhood).

3. Neighborhood Insights

Steering is why Realtors can't tell you things like the demographics of a neighborhood, the racial makeup of an area, or personal details about previous homeowners. Motivated by prejudice and profiteering, real estate steering and discrimination has been an issue for decades–and it continues today.

"Realtors shouldn't communicate things like whether or not the neighborhood is 'safe,' income composition in the area, and whether or not the schools in the area are 'good' schools," Robyn says. She says that underneath each of those questions is the potential for assumption, misinformation, or prejudice to influence a buyer's decision–based on information that has nothing to do with the home for sale.

4. Tailored Questions for First-Time Buyers

Even if they can't legally tell you everything, a Realtor is still your go-to guide to finding the right home for you. To get the most out of your Realtor relationship, Robyn suggests creating a list of needs and wants for the home you're looking for–priorities that can help your Realtor find a home that meets your needs and budget. They might not be able to use all of that information, but getting everyone on the same page can help narrow your search and eliminate non-starters.

Additionally, it is wise to ask your Realtor about their experience working with first-time homebuyers and how they tailor their approach to meet your specific needs. From understanding the local market to explaining the intricacies of the buying process, a Realtor experienced with first-time buyers can be an invaluable asset.

5. Financing and Budgeting

Your budget plays a significant role in the home-buying process. Ask your Realtor about recommended lenders and financing options. Inquire about potential hidden costs and how to stay within your budget. Understanding the financial aspects of buying a home will help you plan effectively and avoid any surprises.

6. Connect Your Real Estate Professionals

Finally, you’ll want to connect your mortgage loan officer and your Realtor. They can work as a team to provide you with the best experience. Communication between your loan officer and Realtor can sometimes make the difference between a stressful transaction and a smooth, successful one.

Navigating the real estate market as a first-time homebuyer can be overwhelming, but armed with the right questions, you'll be better prepared for this exciting adventure. Don't hesitate to reach out to your Realtor with these questions–they're here to guide you through the process and ensure you make the best decisions for your new home. Happy house hunting!