Home Buying Services You Might Need

There are quite a few services and their respective professionals that you will need to have along in the process of buying a home. Some you will have to pay for directly, others will have their fees included in the closing costs, and still others are paid for by the seller. 

Knowing what each of these experts do, or the role they will perform, how they get paid, and when to engage them will help you get the home buying services to fit your needs.

Home buying services described on this page

Section 1 - Mortgage Broker / Banker

Mortgage Broker is now a house hold term for the most part. Even so, I will still take a minute an explain some history. Many years ago now, folks would just go in to their local bank branch to apply for a mortgage. If they wanted to shop around for the best deal it was somewhat involved. Mortgage Brokers came about to provide the banks with a faster way to sign folks up and provided a more aggressive rate to attract new customers through the Broker. You can still go directly to your branch today if you really want to, however, most (but not all) local branches are not able to compete with the rates their own company will provide to the Brokers.

Regardless of which you choose, you should visit them (or find one) fairly early on in your search for home buying services. They will tell you what the maximum is banks are willing to lend you in the way of a mortgage. Unless you are able to make the full purchase on your own, this is a critical initial piece of the puzzle. 

Incidentally, if you can buy a home outright (or borrow privately, even temporarily) this is powerful leverage in the offer making process as it removes one of the conditions and makes your offer more attractive (more on this later).

Mortgage brokers will collect your personal financial information and try to structure it in a way that will make you more attractive to a mortgage lender. They will pull your credit ratings and get you to fill out lots of forms. Be sure to allow a few weeks for this process, and if you are self-employed or own a business statements from your accountant will be required.

They will insist on bringing out the not so nice parts of your financial history, and discuss how to present it so that you can demonstrate to the bank that while you made mistakes in the past, you have learned from it and working to improve or correct any blemishes.

They will also discuss the risk level of the lenders they deal with and what your likely options will be, along with let you know the maximum you will likely be able to borrow, and with which lenders. You should also get a sample of rates and terms so you have an idea of what the monthly payments will be.

Note: Just because they give you a maximum, does not mean you have to use it as your budget. You need to be the adult in the relationship - you must know if the monthly payments are affordable for you, and understand your own risk in the game. For example, what happens if the mortgage terms ends and it has to be renewed at a worse rate? Or if you took a variable rate and they go up? Can you continue to make the payments?

Mortgage Brokers and bankers get paid by the banks themselves, and usually only once you have concluded a successful mortgage on a purchase.

They are incentivized to find you the best mortgage you can get approved for, amongst the lender they have the best relationships with. This usually works in your favour, however, you still need to be your own advocate with regards to your final decisions. 

My recommendation is to talk to folks who have used a particular mortgage broker, and then search their name on line and see what pops up. You can also just do a search on the internet for Mortgage Brokers in your area, call a few and ask for 3 recent references.

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Section 2 - Realtor / Real Estate Agent

Realtors are easy to find, and almost everyone has a family member who knows a good one. While there may be many good ones, you want to try to find one who’s self interest falls in line with your own to the best possible degree. 

Easier said than done perhaps, luckily when it comes to Realtors, a decent one will be more than good enough - you don’t need a perfect one, especially if you keep reading the pages and articles on Own-The-Door.com.

The role of the Realtor is to sell you a home. They are in the sales business. They only get paid when a sale is completed. It does not mean they will just sell you anything because there is far too much involved in buying a home to risk wasting their time just selling you anything. Therefore, there is a fair bit of need for them to help you find something as close to what you want, and as quickly as possible.

For that reason, I would recommend not holding back on information or price range up front. Better to give them the raw details, it just saves everyone time.

The Realtors are not just sales people. Their role is more involved, or should be. They are your gateway to the Real Estate Market. They are often your guide to all the paper work, and often understand a good portion of the legal component. They can also help you connect with Inspectors, and even Title Companies - experienced ones have likely worked with most (though you should still absolutely doing your own due diligence on each recommendation).

There are essentially two types of Realtors. Buyers Realtors and Sellers Realtors. Many do both, but often they will have a preference. Some will put most of their efforts in to working their (usually well established) network to have as many selling listings, knowing how to describe the listing it and access to good staging companies.

Others, usually ones who are in the process of building their network, will work hard for buyers. They sometimes will specialize in certain areas, or rather just have more experience in some areas (good or bad). When you find a perspective realtor try and see if they have some experiences which will line up with the type of home you are looking for, or the area you are looking in.

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Section 3 - Lawyer / Solicitor / Title Company

Lawyers or Solicitors (Also called Barristers) or Title Companies (state specific) full fill the role of a trusted third party in the execution of a purchase or commercial transaction - in this case - buying a home!

You have to check with your individual State laws as to wether you need a Lawyer or if you can use a Title Company. If your purchase is complicated or if you are worried the property Deed might be complicated, you likely want to engage a Lawyer. Title Companies are better for straight forward purchases.

In Canada, every province requires the use of Solicitors / Barristers. Some specialize in Real Estate, and while you don’t need a law firm that specializes in Real Estate it does not hurt if they have that in their locker.

Most law firms will want a “retainer” up front to cover out of pocket expenses (likely in the $200 range), and their fees will be charged on closing. You can usually find out what their fixed fees are up front, however there are numerous other expenses which they will take care of as part of their services, including municipal fees, State / Provincial Fees, mortgage fees, etc. Often they will be charged with distributing all of the other fees associated with the purchase. They should be able to give you an estimate, but as they are variable you will always be responsible for the final actual costs. Most of the time this affects the sellers of the home more than the buyer.

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Section 4 - Home Inspector

You will want to put some effort in to finding a good Home Inspector. They are often licensed by the State or Province, however, that just establishes they are not incompetent. In my experience there are a lot of really decent Home Inspectors, however, finding a good one is better. Getting neither the least expensive company or individual, nor the most expensive ones will not necessarily help you find a good one.

It is more about doing some “due diligence” which is basically a fancy term for asking a few questions. You need to get 3-5 references, and actually call them. Did they provide prompt service, arrive on time, explain the issues in a way that made people understand them, or did all the issues seem “scary”.

You want to also ask for a copy of a previous report, so you can compare it to another inspectors report in terms of # photographs, detailed information or even amount of areas they would routinely check. Did they use moisture meters? Mirrors? Check behind electrical cover plates? Research the property before hand? Do they inspect pools? Etc.

Because an Inspector will not be able to see every problem with a house or building (they cannot do destructive testing or open walls), I prefer an inspector that can tell you if an issue noted in the report is something that you need to worry about or if it is relatively normal for a house of the type, age and location.

Personally I like the ones that put the detail in the report, but then are willing to chat with you after and use more straight forward language to tell you, if they were the buyer, would the issue cause them to lose sleep? Or something to just be aware of. If the former, then they should be able to explain in terms you can understand what the risks are and how expensive the remedy might be.

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Section 5 - Insurance Broker

Insurance brokers have been around for over a generation or two now. Most folks will have dealt with at least one by the time they are in their twenties. Most brokers have affiliations with one or more Insurance companies, and in some cases there are still insurance companies that will deal directly with the consumer.

In most places, having insurance for your home is a legal requirement. If you need a mortgage then it will usually be a condition of the mortgage. Personally I have always had home insurance, both in Canada and in the United States. 

We have always tried to find an Insurance Broker who is local to the area that we are buying in. The main reason was, they seemed to have good experience with most of the housing types in that region, and had good connections with the insurance companies that did not have a bias against those housing types.

Every region, State or Province will have issues particular to that geographical region (in addition to housing types). For example, Florida has its’ hurricanes and surge zones; Phoenix has these ground fissures they call “sink holes”; the city I grew up in in Canada is right on a seismic fault line, and has flood zones. 

There can also be regional differences in home construction. All to say, some Insurance Companies have less experience in certain regions and if you home ticks one of their “riskier” profiles then you will pay more. Whereas the same house with another company may just be a “normal” home. The insurance premiums are very different depending on the insurance company’s perception of risk.

The message: Shop around. Shop local.

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**  You may also want to check out our Buying Home Insurance Before Closing page to learn more on this subject.

Section 6 - Even More Experts?

Yes there is an endless directory of potential services you might need. However, here is a quick list of some of the more often used home buying services.

1. Contractors - General contractors, handyman services, electricians, plumbers, roofers, deck builders, etc. - fix code related issues or more major repairs.
2. Mechanical Technicians (HVAC) - They service air handling units, furnaces, air conditioners or anything to deal with home comfort including heating, ventilation and air conditioning (and thus the acronym H. V. A. C.)
3. Locksmiths - They service, install or change out the locks and locking hardware on homes; Cut keys; some deal with alarm systems as well.
4. Alarm System Technician - Companies usually specialize in one or two brands of alarms security systems, including cameras, and will usually provide the monitoring service as well.
5. Pest Control - These are experts usually in the most common form of pest in the area, such as: Termites, ants, racoons, squirrels, skunks, mice….the list goes on. Any creature of nature who has decided to reside in your dwelling rent-free is usually considered a “pest”. 
6. Window coverings - While not necessary and you can certainly buy them and install them yourself, many folks will budget for this type of service company.
7. Last but not least - Movers. You can rent a truck, press-gang your family and friends in exchange for beer & pizza….or you can get a quote or two from a professional company, and your friends and family might bring you the beer & pizza! 

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**  You may also want to read through the Home Buying Contingencies page for more information on what you may need to budget for!

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