How to buy your PERFECT Jackson Lake Home…
There are many opinions and lists of must do items for buying a vacation home. Also, many people like me buy a lake home for their primary residence; but these basic steps are wise to implement in your process.
1. First, get your “money right” as we say in the south. Don’t make it a stretch on your budget. With historically low interest rates, it’s easy to think you can handle that extra $50k in purchase price. However, keep in mind any initial repairs (known and unknown), furnishings, and projects such as a new dock, seawall or additions. For Ga. Power properties, there are two major lenders offering good rates for 25 to 30 year terms. However, if your primary residence has substantial equity, consider a HELOC or second mortgage for an even better rate and buy your lake home with CASH. As always, cash is king, so look at your investment portfolio, and consider investing SOME of this in your lake home. This will give you maximum leverage in contract negotiations.
2. Establish a Price Range Owning a vacation home should be pleasurable, not the source of constant financial stress. My rule of thumb is to have at least 20% of the purchase price in hand to cover down payment, closing costs and initial furnishings. Also, if special projects are needed, make sure funds are comfortably available so you can get the work done and ENJOY your new Lake Home.
3. Find a Jackson Lake Realtor with extensive experience. The best realtor for lake property will already be very familiar with the properties on the market, lake specific building restrictions, and the latest trends in pricing. This will help guide you to the area of the lake that best suits your needs and most importantly…where not to buy. A realtor whose primary goal is to help you find the perfect home will ask important questions to assure your needs are met for the long term. Is this a full time residence? What will be the main use of the house & property? Where are you commuting to/from? Are there special needs? Do you have friends on the lake? This conversation will help narrow your search and get you focused on the properties that fit your specific desires, so no time is wasted in finding the best lake property for you.
4. Time to shop! Once you and your Realtor have discussed each home that could fit your specific needs, consider beginning with the top 6 or 8 homes and bring a note pad, and even a camera, to refer back to later. Your Realtor will know most of the homes listed and can help steer you in the right direction. Think about the afternoon sun, winter wind, water depth & clarity and other factors important to you. Don’t waste time on a home that doesn’t fit. Move on and find the one…you will know when you see it.
5. Make an offer. Discuss with you Realtor. How long has the house been on the market? Is it priced fairly based on comparable properties? Is the seller motivated? All these and several other items go into the decision on how much to offer. Don’t lowball just to see what happens… this can backfire if you really want the house. Make your offer with strength…substantial earnest money & a letter from the bank showing you have access to the funds. This will make the seller take notice. You are not just another shopper. You are a serious buyer!
6. Time to negotiate… The price is only one part of the negotiation. Deciding who pays closing costs, attorney fees, and transfer costs are all on the table. A savvy realtor with lake experience is valuable here. Also, contingencies must be agreed upon. Consider a 14 day period for a professional home inspection to uncover any hidden defects. If there are issues, you have more leverage. You may renegotiate the price, fix it yourself, walk away or ask the seller to make repairs. You have 10 -14 days to make the decision and get your earnest money returned.
7. THE Financing Contingency Your banker can guide you on the financing contingency period, usually 30 days. This period is lengthy because the property must be appraised for the lending institution. This is the biggest deal breaker of them all. You and the seller want to make a deal at “market price” and the bank wants to know at what price they can sell the property if you default on the loan. If there have been low priced foreclosures sold recently this can cause the comparables in an appraisal to be skewed to the low side. If the appraisal comes in too low, you have the option to appeal the appraisal and pay for a second opinion, renegotiate the sales price, fork over more cash at closing, or walk away.
8. Closing time. This is the fun part, yet often quite nerve racking until all the papers are signed. Your banker, closing attorney and Realtor should have all the pieces in place such as financing, inspections, termite letter, lease transfer, title insurance and other required documents. You need to get a homeowner’s insurance binder from your insurance broker and consider an umbrella liability policy for extra protection. Come in with a positive attitude and ask questions if there is ANYTHING you don’t completely understand. Closings last from 15 minutes to several hours if there are document issues. However, for the most part you will be the proud new owner of a Jackson Lake home in less than an hour!
Again, this is just an overview of the process. Choosing a realtor who understands the importance of these factors is priceless in finding your perfect place. Jackson Lake is truly an amazing secret, hidden just a short drive from the craziness of Atlanta. Come to the Lake…you may never want to leave!