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10 Questions to Ask Before Buying a Home

10 Questions to Ask Before Buying a Home

4 min read
Scott Smith

Scott Royal Smith is an asset protection attorney and long-time real estate investor. His law firm, Royal Legal Solutions, helps thousands of real estate investors and entrepreneurs in all 50 states protect more than $1.2 billion in assets. Since 2014, he has published over 1,000 posts and articles on BiggerPockets and has appeared on hundreds of podcasts.

Scott fell in love with real estate when his commercial property investment allowed him to graduate from Albany Law School debt-free. He immediately began practicing at the trial and appellate court with the district attorney, placing him in the top 1 percent of lawsuit attorneys in the county in terms of professional experiences. He also worked in private practice, suing insurance companies for denying valid claims (which is surprisingly common!).

After his friend lost $3 million in real estate from a single lawsuit, despite having ample insurance, Scott dedicated himself to educating real estate investors on the importance of affordable asset protection, specifically when it comes to folk knowledge and misconceptions that still exist in the investment and legal community. The solutions Scott recommends for his clients are the same ones he originally created for himself and has been refining on his mission to help people protect themselves from frivolous lawsuits.

Follow Scott as he deconstructs the litigation game and shows you how to free your time, protect your assets, and create wealth that lasts for generations.

Scott regularly appears on shows with folks like Grant Cardone, BiggerPockets, Entrepreneurs on Fire, Wheelbarrow Profits, and his own real estate investing podcast. He frequently interviews industry experts on his Facebook and YouTube accounts and has published thousands of posts and articles on BiggerPockets and his blog for real estate investors.

Scott graduated from Albany Law in 2014.

He has passed both the Texas and New York bar exams.

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There is a lot to consider before buying a home. If you’re going to live in the home, you’ll need to get a clear picture of what the next few years will look like for you and your family. If the house will be an investment property, you’ll need to understand what kinds of risks you’re taking on.

Before you even think about making an offer, make sure you discuss the ins and outs of the property with your real estate agent. Any stone left unturned could turn into a burst pipe or serious damages down the road.

Here are several of the most important questions to ask your agent when buying a home:

  1. What am I going to pay each month to keep this house running?
  2. Is this house in a flood zone?
  3. When are the sellers looking to close and move out?
  4. Why are the sellers looking to close and move out?
  5. What is the market like in the neighborhood?
  6. What is life like in the neighborhood?
  7. What is on the seller’s disclosure?
  8. Have the owners filed any insurance claims in recent years?
  9. Where can I find paperwork for the home’s appliances and systems?
  10. Would you buy this house?

Now let’s take a closer look at why each question is critical and how to apply the information you gather to your decision on whether or not to purchase the property.

young dark-haired woman in gray sweater standing in front of blackboard with questions drawn on it in white chalk

1. What Am I Going to Pay Each Month to Keep This House Running?

You should already be pre-approved for a mortgage, but talk to agents about just how much it costs to keep the lights on. These costs could show you just how much wiggle room is in your budget. Unusually high electric and heating costs could also point to problems that you will need to fix. (A lack of insulation or leaky faucets could affect utility bills, for example.)

If you are buying a condo, don’t make assumptions about HOA fees. Get the details from your agent and be sure to ask whether any HOA assessments are coming up. New condo owners are often overwhelmed with disclosures, assessments, and other high fees, so eliminate as many surprises as you can before you buy.

Related: 7 Signs of a BAD Real Estate Agent

2. Is This House in a Flood Zone?

Don’t forget to consider homeowner’s insurance when calculating monthly payments. Flood insurance, earthquake insurance, and other structures’ insurance will add up quickly. Figure out how much it would cost to rebuild your home and factor this into any insurance payments that you will have to make throughout the year.

3. When Are the Sellers Looking to Close and Move Out?

Sellers who are pressed for time may not have the resources or capability to wait around and negotiate with every buyer who comes their way. If you know that the sellers are looking to get out in a hurry, you could potentially score a deal.

Aerial view of of a residential neighborhood in Hawthorne, in Los Angeles, CA

4. Why Are the Sellers Looking to Close and Move Out?

Sellers may need to start a new job in a new city soon. Or they may just be running away from a house that can’t be saved. Do a little digging as to why the sellers are selling. Your curiosity could reveal some problems that you don’t want to fix.

5. What Is the Market Like in the Neighborhood?

Take a drive around the neighborhood to see if any other properties are for sale. Is everyone looking to move out? Or is everyone looking to move in? This information is key not only for investors but also for buyers who might want to wait things out and see what other opportunities arise in the area.

Be sure to do some digging into the value of the homes throughout the neighborhood, too. This will help you determine what is a fair price for the home you are looking to buy.

Related: 4 Things You Can Negotiate Besides Price When Buying or Selling a Home

6. What Is Life Like in the Neighborhood?

A house isn’t a dream house if the nightly train shakes the whole property at 3 a.m. Open houses don’t show the damage from rowdy teens. Take some time to research the demographics of the neighborhood and who you’ll be living around. If you plan to flip the property or rent it to long-term tenants, you might still have to answer similar questions about life in the neighborhood.

7. What Is on the Seller’s Disclosure?

Almost every state in the country requires sellers to sign a form disclosing important information about the condition of the home. This form could include information dating back a decade. If there is anything wrong with the house, the seller’s disclosure form should let you know.

Real estate agent handing the house key

8. Have the Owners Filed Any Insurance Claims in Recent Years?

Alternatively, you could ask to see a Comprehensive Loss Underwriting Exchange (CLUE) report. Only homeowners and insurance companies have access to this report, but it’s easy to obtain and pass along to buyers. This report will show you any insurance claims that have been made in recent years after incidents such as vandalism or natural disasters caused damage to the home.

The CLUE report, seller’s disclosure forms, and other insights will help you get the full story on the property you want to buy. Without this story, you can’t confidently write the home’s next chapters.

Related: 3 Tips for Finding a Real Estate Agent (for Investors!)

9. Where Can I Find Paperwork on the Home’s Appliances and Systems?

Even if the house has brand new appliances and an HVAC system, look for documentation. Get warranty information on everything in the kitchen and anything that might need to be replaced in the next few years. Organized documents will be a huge time-saver if you need to call a repairman or have routine inspections. If the seller isn’t organized, it might be a clue of things to come.

10. Would You Buy This House?

This is always a fun question to ask your real estate agent. Turning the question on them may bring up any hesitations (or great features) that you hadn’t previously thought about. If your agent isn’t enthusiastic about buying this house for themselves, why would they want to show it to you?

If you have a question about a property, don’t be afraid to ask. The more you know about your potential home or investment, the easier it will be to make the right decision.

Are there any questions you’d recommend adding to this list?

Share below!