You found a home you love, but if you knew about its history, you might not love it as much. Before you jump in head first, make sure you know about the home’s history. It might not be a walk in the park to find out exactly what the history of the home is, but it will be worth your efforts either for peace of mind or to help save you in the event that there is a history behind the home that you do not want to deal with after all. Here are a few steps to help you get started.
The Title Agent is a Great Starting Point
The title agent will be a required party to the mortgage process as he needs to reassure the lender that the title is free and clear of any liens. This will help you to understand the home’s history to a point. If there are any tax liens (unpaid taxes); lawsuits; or other legal issues, they will come up on the title. This will give you an idea of what the home went through before. If there is a lawsuit, you want nothing to do with the house as you have no idea why there is a lawsuit and what could end up happening. The same is true for unpaid taxes; unless you want to pony up the money for the taxes that you do not owe but that must be paid before the house can be bought, you cannot purchase the home.
Look at the Property Tax Records
Property tax records are public knowledge, so you can easily gain access to them before you purchase the home. When you obtain the records, do not only pay attention to whether or not the taxes are current but look and see how long the current owner has owned the home. You can usually also see how many years of taxes were paid on time as they will show the due dates as well as the date the taxes were actually paid. If you find that the taxes were paid very late during certain periods of time, it could be an indication that the home went through foreclosure or a vacant period. You might want to pay closer attention to the structure of the home in that case, just to me sure everything is safe and sound.
Permits Issued in Home’s History
You also have the ability to inquire with your city about any recent permits that were taken out on the property. If there were recent permits, you can inquire about the work done and who did it. You need to make sure any additions, repairs, or remodeling was done with expertise and done right the first time. The last thing you want to find out is that there is something wrong with the work that was completed and now you are going to have to fork over the money to fix it in order to have safe and stable housing.
Check Flood Zones
If the home you wish to purchase is in a flood zone, find out about the history of flooding in the area. Talk to the insurance company that holds the insurance right now for the home about any recent flooding issues and then do your homework to find out any flooding that happened in the past. If it is located in a flood zone, talk closely with the inspector and appraiser to see if they notice any damage that occurred as a result of flooding that could be of potential concern to you.
Understanding the history of a home can help you determine if it is a sound financial decision. If a home seems like it is too cheap, there could be a good reason for it; the seller might be trying to cover something up. Before you become gullible enough to purchase the home, consider taking the above steps to determine the safety and stability of the home before you make a major purchase, such as purchasing the home.
Justin McHood is America's Mortgage Commentator and has been providing expert mortgage analysis for over 10 years.