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Top 4 Biggest Home Buying Mistakes You Can't Afford to Make

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Real estate agents see buyers make many costly mistakes. Read about the top 4 biggest home buying mistakes you can't afford to make & how to avoid them.

Home Buying Mistake #4 - Focusing on Wants Instead of Needs When Considering Homes

This next mistake is closely related to the one above. The wants are the more emotional choices rather than the practical ones that serve a purpose. As Haymarket, VA ReMax Olympic real estate broker Chris Howell points out this problem often plagues inexperienced first-time buyers.

"First-time home buyers will obviously make the biggest number of mistakes as they don't exactly
know what they need, they shop only for what they want. The experienced home buyer will know what is really important to them."

How to Avoid Making this Mistake: Make a home search must-have list and refer to it any time you find a house that you 'love'. The must-have list should be needs, not wants or wishes. This list will help keep you grounded and focused on the bottom-line. Look for a home that meets the most of your must-haves.

How to Recover if You Made this Mistake: If you're in the negotiation process on a home and realize that it doesn't meet a number of your needs then use the provisions of the contract that will help you either get out of the deal (losing the little bit of money you may have invested is better than buying a house that isn't right for you) or fix some of the issues before you close on the home.

Home Buying Mistake #3 - Not Getting a Thorough Inspection

The inspection is a critical point in the home buying process. It's when you will get a real look at what a home is made of, literally. It's also gives the buyer the power to walk away from a contract if the home isn't exactly what they expected and to re-negotiate. Yet, many buyers are so excited to have found a home and signed a contract that they don't do their due diligence and get a thorough inspection.

How to Avoid Making this Mistake: Susan Barlow, real estate agent at Prudential California Realty gives buyers this advice, "Hire a licensed home inspector - this is critical, no matter if you're a first time buyer or a seasoned investor. Too often people get emotionally involved in the purchase and can't make objective decisions. This is just one of the reasons an inspector is important."

How to Recover if You Made this Mistake: Unfortunately, there isn't much you can do once the inspection period has passed. There is a good chance that the home is in good shape, however you probably won't know for sure until after you've moved into the home. Your best bet is to get a good home warranty which will cover some of the issues that may arise.

Home Buying Mistake #2 - Not Using a Qualified Agent

Having a buyer's agent working on your side will help you to avoid all the other mistakes listed in this article.

Victoria Shtainer, Esq., Senior Vice President Associate Broker at Prudential Douglas Elliman Real Estate, explains this well:

"By using a broker/ agent you are getting an ally and negotiator for free. You are using all the knowledge and skills without paying for it. By using an agent you remove yourself from the situation especially in a negotiation. An experienced agent knows how to get to the closing table by helping the buyer and diffusing conflict. The buyers’ agent can help you in showing you correct homes that fit your search criteria instead of you walking around and spending every Sunday at an open house. If they are an experienced agent they will show you where the value is and explain that not all sales in the area are the same. They can also advise you how to present the offer correctly. The biggest mistake buyers and sellers make is NOT using an agent. It hurts their final sales price."

How to Avoid Making this Mistake: Simply put, find a real estate agent before you look at homes. Ask friends and family members for references and talk to a few agents before deciding who you would like to work with.

How to Recover if You Made this Mistake: It's never too late to find an agent. Even if you're under contract there's still plenty of guidance that an agent can give that will make getting to the closing table a lot easier.

Home Buying Mistake #1 - Not Getting Pre-approved for a Loan

When we polled our real estate resources, the majority said not getting pre-approved for a loan was by far the biggest mistake a buyer could make. It should be the first thing you do if you're serious about buying a home.

How to Avoid Making this Mistake: Don't skip the pre-approval process before you start looking at homes. John F. Sullivan, Vice-President & Associate Broker of Buyer's Edge Co., Inc., put the it this way when asked about big buyer mistakes:

"Failing to get fully approved, not pre-qualified, by a local direct lender before looking at houses. The difference is the approval comes only after the lender has verified the buyers income, assets, has run a fully credit report and the verified documentation has been reviewed by an underwriter or thru desk top underwriting. This will prevent the buyer from looking at homes they can’t afford and put them in a strong negotiating position for making an offer."

How to Recover if You Made this Mistake: Start shopping around for a local lender and get all your paperwork together. Once you've found a lender you like get them to give you a pre-approval.

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