Sometimes shopping for your first home can be so exciting that clients don't take seriously (or are unaware) of some of the potential pitfalls in real estate. We have put together a small list of some of the most important mistakes first time home buyers often face when searching and buying a home.
1. Shopping for a home before meeting with a Loan Agent
So many home buyer make the mistake of looking at homes either with an agent or by coming to open houses without first meeting with a mortgage lender. The problem here is that you find the home of your dreams, have you agent write on offer, but the offer gets rejected because it is not accompanied by a pre-qualification letter. Now you heart is broken because that was the perfect home.
If for some reason the offer gets accepted, you may find out after the fact that what you had calculated from on online mortgage calculator, may have not been correct and now you are in escrow for a home that is much too expensive for you.
2. Buying a For Sale By Owner
Purchasing a home through a For Sale By Owner (or FSBO) can be dangerous. With out representation and legal documents, there are numerous ways to get in trouble in this process. Like not having unbiased advice on inspections detailing any potential issues with pests, foundation, roof, electrical, etc. Also not knowing if you are getting a fair market value with a up to date market analysis. As a buyer, it is important to know that you don't pay any money for the help of a realtor. The realtors commission is paid for by the seller. So please, make use of the advice of professionals.
3. Not Leaving room for expenses
We know how exciting buying a home is. We are home owners too. We have seen clients put every cent down for the down payment and negotiate all their cash away in order to get the home of their dreams. However, we urge you to retain some funds. We find that once a home is purchased often times clients want money to have new carpets installed or landscaping. It's also important to retain money in a savings account so that you have money in case you need it since life can be so unpredictable. The standard is to keep 3 months of mortgage payments in a savings account in the event of injuries or layoffs.
4. Lying to your Loan Agent or Realtor
Your loan officer and realtor are on your side. They are there to give you the best advice and direct you to make smart choices for your future. Being up front and completely honest with both parties is really the best way to go. Normally through an escrow process, every little purchase, loan, or lien will eventually come out, so the sooner everyone is aware, the better it is for you.
For more information on purchasing your first home, give us a call or text at at 530-720-5327
Author:Jake Grabarek BRE#02043581 Phone: 530-720-5327 Dated: June 1st 2018 Views: 71 About Jake: Jake is a driven and passionate young man. His appreciation for real estate and ability to produce a...
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"We listed our home in Mineral, California with Joe in May of this year. He was very honest in telling us that homes in Mineral do not sell quickly or often. He said it was a bit out of the Lake Almanor/Chester area that is his expertise, but he would work as had as possible to get our property sold before winter began. Good to his word, our property was sold and the new owners had the keys in hand in early September. That is amazingly quick for the Mineral area. We are thrilled."