Tuesday, September 16, 2008

Top 10 Home Buying Mistakes

Buying a home is the largest investment a person will ever make; yet all too often the decision is made in haste without proper preparation

Using this list may help you avoid any costly mistakes;

1. Love at first sight: Falling in love with the place at first sight. Does it meet your family’s needs and budget? Make a list of all your needs and make sure the house fits into those needs. Check out the neighborhood and the community before you buy.Visit at different times of the day and week to learn about noise and traffic patterns. Park on the street and observe some of your neighbors and their actions. Even if you don’t have children, the local schools will have a lot to do with possible resale value.

2. Failure to be Pre-Approved: Getting pre-approved will give you an idea of how much you can afford to borrow. Being pre-approved means a lender has verified your information and credit rating and agreed to provide you with a specific amount of money. Most savvy home sellers are going to require a pre-approval when your offer to purchase is submitted.

3. Buying Too Much: Even though you can purchase a larger home and make the payments, take a reality check. Figure your actual monthly costs, including medical, groceries, automobile, include everything. Try to stay around 38% including your mortgage. Always figure 3% of the sale price for closing costs and another 1% for moving cost, new drapes and decorating costs.

4. On Your Own: Buying a house can be full of pit falls. make sure you hire a qualified buyer's agent, a lender, and a ASHI qualified home inspector. Request referrals from family and friends.

5. Making A Verbal Offer: Not putting an offer in writing allows for too many miscommunication. Never go by a verbal statement, if something is included in the sale like a refrigerator or stove make sure it's written into the contract. A written agreement always stands up in a court of law.

6. Create Contingencies: The more the better. Using a standard St. Louis Realtor contract provides these contingencies;
A. Financing: Allows the bank to have final say regarding appraisal,inspection and your ability to repay.
B. Title: Insures that any potential liens against the property will not pass with the ownership.
C. Insurance: Guarantees that the property is insurable, including flood and hazard insurance if required.
D. Survey: Insures that no other property is encroaching on your property or that your property is encroaching on a neighbors property.

7. Not Reading Everything You Sign: Always read the fine print and ask questions if you don't understand. Getting all the paperwork a few days in advance will allow you to read everything and have your questions ready.

8. Trust: The recent mortgage Crisis reminds us all to do our research and make sure everyone involved in the transaction knows their responsibility and is acting in your best interest, not his/hers.

9. Buy Low Sell High: Purchasing the highest priced home in the area can backfire on you, when the lower priced homes are sold. looking at the amount of foreclosure's on today's markets reminds us that markets can change.

10. Remorse: Don't worry about it. Everything will be fine. Buyers remorse almost always happens after such a large commitment. You've found the perfect house, now enjoy it.

The 'H" Team can assist you as a buyer's agent. Contact Us Today for your free buyers guide.

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