As Americans face the toughest real estate slump in years, many are considering permanent house swapping as an alternative to letting a property sit for countless months or even years in the stagnant market. While there are many benefits to perusing a home exchange, the potential buyer should also keep in mind that this kind of transaction is fraught with many dangers. Here are a few tips to conducting a safe and successful home exchange.
Get the Home Appraised and Inspected
Without the involvement of a real estate agent, there is a greater chance that important information regarding the property is being withheld or overlooked. The first step a potential buyer should make in a home swap is to get the property appraised and inspected by qualified professionals. Buyers should also keep in mind that a seller who owes more on a home than it is worth may have difficulty securing the necessary financing to close the deal. It is best to avoid such a situation.
Get to Know the House and the Neighborhood
Potential buyers in a home exchange should make it a point to familiarize themselves with both the property and the surrounding neighborhood. Even if a home is located in a different part of the country, a buyer should make the effort to see the property in person. By doing so, the buyer reduces the risk of being deceived or even outright scammed. Some sellers may even agree to let a serious buyer spend the night in the home.
Getting information about the neighborhood is also very important. A buyer may want to know about the neighbors, the local school system, and other neighborhood facilities as well as any construction projects that are slated to start in the area. Moreover, if the property is in another state or county then there may be significant differences in taxes and zoning laws that the buyer should be aware of.
Hire a Qualified Real Estate Attorney
Since there are many important details involved in the purchase and sale of a home (details that can be easily overlooked or misinterpreted) it is in the best interest of both parties to be represented by qualified real estate attorneys This will also help to reduce the chances of fraud.
Ensure that the Closing is Simultaneous
Both parties involved in the house swap should use only one title company so that the two transactions can close at once, and there should be a contingency in the contract that the deal is not complete until all parties sign off on it. This will ensure that both sides will be fully involved in the exchange- e.g., that one side will not pull out of buying the other’s property once their home has been purchased.
If the Transaction Seems Off… Then Stay Away!
With a home exchange, both parties are essentially buying a house for sale by owner. There are countless stories of people who were scammed while trying to buy a home. If a buyer senses that something is off with either the seller or the transaction, then the buyer should at most back away, and at the very least proceed with caution by taking all the precautions mentioned in this article as well as the articles that are linked to it.
In short, entering into a home exchange has a lot of benefits, but the transaction must be done carefully. By following these house swapping tips buyers can protect themselves from being deceived or scammed.