Money Monday: 10 Biggest Mistakes Made When Buying a Home
Buying a home is the one of the largest investments most people will make in their life. There are many emotions and feelings that come into play when it’s time to make this decision from excitement to anxiety, fear and nervousness. Therefore there are a few things you need to make sure you are aware of to make this process as smooth as possible and make the overall experience a memorable one. Use our list of commonly made housing mistakes to avoid any regrets.
1. Doing it alone – Buying a home is a complex transaction involving many complex pieces such as the sales contract, inspection, title search, insurance, escrow, etc. This is not a journey that anyone should ever take alone regardless if this is your first home or your fifth home. Form your dependable team of family, friends and professionals, while the ultimate decision will remain with you it is good to get the opinion and advice of those you respect.
2. Buying at first sight – You may walk into a property and fall in love with it at first site and are 100% positive that this is the one. Don’t make that decision to quickly, make a list of your family needs, budget, and family wants then make sure that the house can accommodate these needs. You may have to sacrifice some things to get others but it should overall fit you and your family. Don’t forget to check out the neighborhood and the community before you buy, visit at different times of the day and the week to learn about noise, traffic problems and patterns. Regardless if you have kids or not check out the schools they play a huge part in your resale value.
3. Not getting pre-qualified and pre-approved – Being pre-qualified gives you a sense of how much you can afford if you are doing traditional lending. Being pre-approved means a lender has verified your information and will provide you with financing for a specific amount of money.
4. Overbuying – You may qualify for more, but can you afford to. You must take into account all your other expenses. Analyze your monthly obligations like debt, food, transportation, entertainment, savings, and miscellaneous and emergency. The general rule used is to try and keep your mortgage payment to about 36% of your income before taxes. Don’t forget that you need to budget money for closing cost (typically 2% – 5% of your homes purchase price), plus moving expenses, decorating and maintenance. You should also allow for increase in bills like utilities and taxes.
5. Misplacing your trust – No matter how much you like the people you are working with or the fact that someone vouched for them, you must remember that this is a business transaction. Do your research as well
6. Relying on oral agreements – Make no mistake a written agreement will always trump a verbal one. No matter who you are dealing with you do not have a contract until it’s written on paper.
7. Skipping the fine print – Make sure you understand everything that you are signing before you pick up the pen. Take time to read the documents and ask questions. Always get copies of your mortgage papers.
8. Forgetting or betting on resale – Avoid buying a home that cost 50% more than neighboring homes and think buying the most expensive home on the block is a cool thing. This is not a good thing the lower home values affects your value and remember markets change. It is important to buy your home at the correct home value.
9. Making an unconditional offer – Protect yourself from taking a house as is. You should always want to get a home inspection done on your home regardless if it is brand new or existing. Make sure that you can get adequate home insurance, and don’t forget that if you are doing traditional financing the lender will want an official appraisal done before they provide funds.
10. Having buyer’s remorse – Remember that no place is perfect. It’s a guarantee that you will get some surprises in your home. Don’t let these little blips spoil the entire ride and certainly don’t miss a great house trying to find the perfect house!
ASG Investments certainly loves working with home buyers to make this process as simple and smooth as possible. We have a large selection of homes to choose from and our staff is highly trained and experienced with working with first time home buyers to experienced home shoppers.
We have many financing options to choose from and we are sure we have one that can get you into a home today. Don’t wait any longer, the time is right now to buy call us 1-888-210-6134 or email us at Info@asginvestments.com
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