7 Buying Mistakes Every Buyer Must Avoid
Purchasing your home is one of the biggest if not the biggest decision individuals and families make. It is important to be prepared when the house you want is within your grasp. So one of your most important decisions should also be coupled with buying knowledge to make informed buying decisions. You and your family deserve it.
Here are the Top 7 mistakes to avoid when buying your next home:
- Not being pre-approved before you start the search and contract process. The fact is that guidelines have changed over the last few years and what was an easy approval may now have some tighter lending hurdles to get your purchase to the closing table. Most pre-approvals can be done in 24 to 48 hours so don’t miss your dream home because you get caught in the “guideline change trap.”
- Make sure your down payment funds match your financing choice. All too often buyers start their purchase only to find that either where their funds are coming from or how much they think they need does not match what is allowed to get financing. Tip- FHA allows gift funds so most of the time you are covered, but Conventional financing requires that the funds to close be your funds in a personal account for 60 days or more.
- Buying a large dollar ticket item during your contract period. This could derail your deal two fold. First, for today’s approvals most banks will RE-PULL your credit the day before you close and new payment could cause you not to qualify. Secondly new activity on your credit could drop your score and take you from approved to “Suspended” status and could cause you to miss your closing date.
- Forgetting to put an inspection period in your contract. That may leave you no room to renegotiate the deal if you find a material defect in the property because you left out the “Inspection Provision” to remedy the unforeseen problem that needs to be addressed.
- Writing a contract that does not have a proper closing window. Sometimes you get pressure from the seller’s side of the transaction to close in a shorter time frame than the current market conditions. Talk to your lender BEFORE you write the contract and make a team decision that is consistent with the right amount of time to close. When rates are good the banks and underwriters have deal after deal stacking up and turnaround time increase. A quick call to your lender up front before you offer can dramatically increase the opportunity to have a good and smooth closing.
- Writing a contract with a loan commitment period into the contract that is nearly impossible to meet. Financing is tougher today and with rates lower the combination can cause the approval to take longer. The loan commitment period is your promise to deliver a clear approval to the seller to demonstrate that your contract is the one to accept. Your loan commitment should be no less than 3 weeks to get the clear approval because understand that there are several moving parts that you need to count on to get the clear commitment. You have lender, your employer to verify employment, appraiser, inspector, insurance agent, Title Company and more. So give yourself the right amount of time to get your cleared approval or you put your earnest money and closing in jeopardy.
- Forgetting to ask the realtor to help you look at the bylaws for the area you are moving into or subdivision rules. This could change your decision to buy that house or not. Finding out the rules later could cause you some duress. Examples are the following: You have 3 pets and there is a 2 pet rule. There could be a no pool rule and you may want to put in a pool. No decks allowed. Wooden fences only. No multiple families living in the same house permitted. And so on…
By asking the right questions and compiling your purchase checklist with the items above you are putting your purchase on the right track for a successful closing. Not to mention increasing your confidence that you have everything in place on the front end which allows you to focus on all of the back end checklist items that are important to get you moved into your new home as easily and seamlessly as possible.
We are committed you your success and our company is ready to produce the best buying experience by putting your need at the top of our company checklist will put you one step closer to your new home.
Your partners in real estate success,