Your home represents a major investment, of both your hard earned money and also your valuable time. Make the most of this investment by being as informed as possible about the home buying process.
In this section, Maureen and I invite you to review an industry report titled, “How to Avoid 9 Common Buyer Traps”, found below. In this important report, the 9 most common mistakes made by home buyers are discussed in detail, as well as how you can circumvent these potentially devastating errors.
Indeed, it is our hope that you will learn how to avoid these 9 common Buyer traps, instead making decisions that actually serve to produce a successful, and financially desirable home purchase.
How to Avoid 9 Common Buyer Traps
Regardless of the cost of your home, purchasing a home is a major investment. However, the process can become even more expensive for home buyers who make one of the many costly mistakes which lead to a buyer:
- Paying far too much for the home they have selected
- Losing a home they have fallen in love with, to another buyer
- Buying a home that ultimately does not meet their needs
However, as a home buyer, you can avoid these scenarios, ultimately saving you money and ensuring the home you purchase suits your needs best.
This essential report addresses the 9 most common and costly home buyer traps. By reading this report, you will learn how to identify these traps and, most importantly, how you can avoid them.
9 Buyer Mistakes!
- Blind BiddingWhen purchasing a home, many questions come to mind: if you bid on a home, what price should you offer? Is the seller asking too much for his or her home, or is it a good deal? If you don’t research the market and learn the selling price of comparable homes, making an offer will be like bidding blind. Without understanding the market, it is conceivable that you could offer a bid that far exceeds the value of the home. Alternatively, you could bid too low and loose a competitive edge on a home that is of excellent value.
- Purchasing a Home Wrong for YouWhat qualities do you want your new home to have? What kind of home will meet your needs, and desires? These questions seem straightforward, but in reality are quite complex. Many buyers have found themselves in a home that is too small, or too big, or fails to meet their needs in some other way because they have become swept up in the flurry of the home buying process. It is essential that you carefully consider, and be honest about, your wants and needs. Once you have determined what you demand of your new home, put the list in writing and use your criteria to measure the suitability of each home you consider. If you fail to clearly define what you need and want, you may end up with a home that isn’t right for you. For example, you may find yourself with an inconvenient and unplanned commute to work, or dozens of repairs and renovations demanding your attention.
- An Unclear TitleIt is crucial that you understand early in the negotiation process whether you will own your home free and clear. Thus, it is strongly recommended that you have a title search completed. Ignoring this advice could result in a discovery late in the negotiation process that there are encumbrances on the property which could be tax liens, easements, leases, undisclosed owners or similar complications.
- An Inaccurate SurveyMake sure that your offer to purchase includes a demand for an updated property survey. This survey should clearly define the boundary of your property. If the survey is not up to date, you might discover major structural changes not indicated. These could be changes such as a new swimming pool, additions to the home, or a neighbour’s recent fence installation which extends a boundary line. It is vital that you are clear about these issues.
- Undisclosed Renovations or ChangesNot every seller will admit to or report every physical aspect of the property that requires attention. Indeed, it is important to remember that both you and the seller are aiming to maximize the same investment. It is crucial that you conduct a thorough inspection of the property prior to purchasing. In fact, it is strongly recommended that you hire an independent home inspector who can objectively review both the inside and outside of your potential purchase. To protect your interests, you can make the final contract contingent upon the home inspector’s findings. An inspector should be able to provide you with a report of any items that require attention or fixing, including the approximate cost of such repairs.
- Not Acquiring Mortgage PreapprovalMortgage preapproval is cost-free, as well as quick and simple to acquire. Once you have been preapproved for a mortgage, you can shop for your dream home within your budget. Importantly, you can shop for a home knowing that when you find a home you love, you will be able to finance its purchase.
- Contract MissesIf a seller does not comply to the letter of the contract, by refusing to attend to outlined repairs or in some other way changes the spirit of the agreement, the final closing and settlement could be delayed. It is advisable that prior to commencing on the sale, a dollar amount for an escrow fund to cover such items the Seller fails to follow through on, is determined. Create a list of issues that have been agreed upon and address each point, checking them off as each is satisfied.
- Hidden Costs
Be sure to identify all costs associated with the purchase of a home, prior to closing the deal. If all costs, be they large or small, are uncovered ahead of time, no fees will surprise you upon closing. Importantly, some fees can be added after the “sub” total, such as fees for underwriter or a loan disbursement. Be certain of these fees by having your lender project total charges for you and present them to you in writing. I invite you to consider the report, Buying a Home? Be Aware of These 13 Extra Costs found on my webpage, www.DougBlackstock.com
That report covers these hidden costs in more depth.
- Rushing the ClosingDuring the closing process, take your time and make sure that you carefully review each document prior to signing it. Be sure that the documentation perfectly reflects your understanding of the contract. Pay extra attention to ensure that no points have been added or subtracted. Is the interest rate correct? Has everything been covered? If you try to hurry along this process on the day of closing, you may find yourself with a snag that cannot be remedied without risking the financing, the sale, or compromising the terms of the deal.
Please feel free to contact me concerning questions about these 9 buyer traps.