Top 10 Biggest Home Buying Mistakes You Can't Afford to Make
Real estate agents see buyers make a lot of costly mistakes. Read about the 10 biggest home buying mistakes you can't afford to make & how to avoid them.
Are you making a huge home buying mistake? You may be surprised at how often buyers make costly mistakes - even after being warned by their agent. In this article industry experts discuss the most common mistakes, how to avoid them and how to recover when a mishap happens.
Home Buying Mistake #10 - Buying Big Ticket Items in Escrow
You found the home of your dreams and you're under contract. Time to start buying furniture for your new house, right? Wrong.
Jill R. Silvas, SCRP and Branch Executive/V.P. of Relocation Services at Pacific Union International, noted mistake number 10 this way, "They [buyers] frequently go out and buy ‘big ticket’ items while they are in escrow (like a car, expensive furniture, etc.) which can impact their credit and consequently their ability to get a loan.
How to Avoid Making this Mistake: Reign in your urge to spend and save the big purchases for after the close. Even piling up a lot of small purchases on a credit card needs to be avoided.
How to Recover if You Made this Mistake: If you've made a big purchase that you can return, do so. And make sure that it no longer shows up on your credit. If anything is already in the works but not yet completed, put it on hold and explain to the other party that you're under contract to buy a home and you can finish the transaction after close. If you can pay off anything that was bought using credit do so as soon as possible.
Home Buying Mistake #9 - Underestimating the Market
Michael Signet, Executive Director of Sales at Bond New York Properties, LLC, said, "In my opinion the biggest mistake is underestimating the market. By this I mean that every buyer seems to think that they are the only ones interested in the property. They mistakenly assume that their best strategy is to go slow and make the seller sweat. We tell our buyers all the time…don’t play games. Look at as many properties as you want but when you find “the one” go in fast and strong and make sure you get it."
Monique Bryher, Broker-associate/Realtor at Pinnacle Estate Properties, added:
How to Avoid Making this Mistake: Keep in mind that real estate is local and every market is different. Just because the market overall is sluggish doesn't mean that it isn't competitive in your area. There are always other buyers out there and all it takes is one other offer to keep you from getting the home you've been looking for.
How to Recover if You Made this Mistake: If the home is still on the market or you're still in negotiations think very hard about how much you want the house and what a fair offer really is. Come to the table with something that is based on facts, like comps, not assumptions about how the market affects your ability to negotiate.
Home Buying Mistake #8 - Not Having All Your Paperwork in Order
Are you organized enough to buy a home? As you may well imagine buying a home involves a lot of paperwork. Being prepared with your paperwork is vital for every step in the home buying process.
When asked about the biggest mistakes that buyers make, Jill R. Silvas, SCRP and Branch Executive/V.P. of Relocation Services at Pacific Union International, had this insight: "They [buyers] fail to respond in a timely and/or complete manner to the various providers (escrow, loan officer, agent, etc.) for information and documents that are needed during the process."
How to Avoid Making this Mistake: Make getting your documents in order your top priority before viewing homes or contacting a lender. Ask your real estate agent what all documentation you will need for loan approval and start requesting copies of documents you may not have in your possession, such as this year's W2. Follow up with your agent to discuss what all will be needed after you're under contract.
How to Recover if You Made this Mistake: If you've already started the process of looking for a home and haven't yet gotten all your paperwork in order, stop looking for homes and start looking for your documents. Talk to your agent ASAP about which documents you need now and focus on getting those together. It is also a good idea to keep your documents organized in a file or folder for easy access.
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