12 COMMON BUYER MISTAKES
Buying a home is an emotional roller coaster and a huge financial decision. We’ve sold many homes in the Columbus area and have seen many situations where buyers find the home they want, but make some common mistakes that jeopardize the sale.
It’s easy to get caught up in the excitement of it. Here are just a few of the most common mistakes to look out for…
Searching Without a Plan
Because a home purchase is one the biggest investments you’ll make, being organized and staying in control will help tremendously. A REALTOR can help you lay the foundation. Understanding your personal situation, finances and needs, will keep everyone focused, avoid time wasted and prevent hasty decisions.
Searching Without Your Own Representation
Using a REALTOR to assist you in the home buying process is invaluable. Typically, REALTOR services are at no cost to you, as a Buyer. They get paid by the seller when the home sale is finalized. So, if you’re avoiding using a REALTOR thinking it will save you money, think again. Working with an experienced REALTOR can provide you with resources, tools and expertise needed to negotiate the best deal possible, provide valuable information, protect your interests, educate you about the process and ensure things go smoothly. |
Shopping Without Pre-approval
Securing pre-approval for a mortgage BEFORE you begin your search for a new home can help you avoid a great deal of frustration. It only takes a few days to get a pre-approved, and is usually without cost or obligation.
This can really help in determining how much home you can afford and is an excellent way to improve your position with the seller. It may just be the deciding factor in a sellers’ decision if there happens to be another offer on the table besides yours.
A pre-approval gives you negotiating power!
Changing Jobs During the Buying Process One of the biggest mistakes you can make is changing jobs during the buying process. Doing so, creates a real problem in qualifying for a loan and verifying employment. It can seriously jeopardize you getting the home you want. Talk with your lender before making a move. |
Switching Banks or Moving Money Around
It is best to leave your money right where it is until your loan is closed. Moving your money to a new bank or even into a new account can wreck havoc with the verification process. Please consult your loan officer before any changes are made.
Paying Off Your Debts
Many buyers assume paying off all of the debt they possible can is a good idea. Actually doing so may hurt your credit score and prevent you from qualifying for a loan to buy a home. Your loan officer will advise you if it is necessary to pay off bills and the best way to go about doing so if it’s necessary.
Making Major Purchases…Buying things on credit
Filling your home with new furniture or buying a new car may be on the list of things you want or need to do, but if you want that house, you need to hold off making major purchases or racking up the credit cards. A large monthly payment can affect the amount of home you qualify for and halt the loan process altogether. So, hold off on those purchases until after you’ve closed on your new home.
Talking too Much
Avoid talking to the homeowners or their agent directly. Remember, the homeowner and their agent, are looking out for the best interests of the Seller, not you! By getting caught up in conversation with them, you may be inadvertently divulge information that ultimately helps the seller and hurts your position during negotiations. The same goes for showing any emotion and excitement. Keep the poker face on until you’re away from the home.
By talking, you may think you’re getting lots of useful information about the home, but it’s really the seller who is learning about you. Let your REALTOR ask the questions.
Spending More Than You Can Afford
This is an exciting time and it’s easy to get caught up and fall in love with a home that’s
out of your price range if you don’t start off with a good solid budget and plan. Avoid getting in over your head financially and being “house poor”, by talking with a lender. Be honest with yourself about the reality of your financial situation and make sure the home fits your family’s needs and budget. There are lots of homes out there that you may love, but that doesn’t mean you can afford them.
In addition, just because a lender approves you for $250,000 doesn’t mean you should go buy a home for $250,000. Do you homework. Know your budget and your limits. Do what’s best for you and your family.
Buying a Home That Is Tough to Resell
Begin your search with the end result in mind….look forward to when you may want to sell the home.
You can’t change the neighborhood, so look for a community that is desirable, and home prices aren’t inflated. Look for a home that is priced well for the market, but not the most expensive home on the block. Choose a home that offers what the majority of buyers would want, not the most unique home on the street. Look for a home where home values are stable, not declining and the homes are maintained. Remember, the market changes, so your neighbor’s home values could weaken yours.
No community or home is perfect, but looking to future resell can help you avoid a mistake now.
Picking the Wrong Mortgage
There are many types of loans to choose from, each with its own advantages. Be sure you explore your options. Talk with several different lenders and compare the loan products they have available. Choose the one the makes the most sense for you.
Waiting for the “Perfect Home”
There is no perfect home, just those that come close. By holding out for perfect, you may end up passing on many homes that meet the majority of your needs, only to become so frustrated by not finding what you want that you quit searching all together. Instead of quitting, take a step back and reevaluate your needs and wants. Then choose a home that meets the majority of them.
In addition, homes generally appreciate over time. By waiting to make your move, you’ll likely end up paying more for a home. As home prices, interest rates, loan products, and your credit and financial situation changes, you may not qualifying for as much home tomorrow as you do today. If you have buying power today, don’t hesitate. What is available today may not be tomorrow.