Do You Make Any of These Costly Home Buying Mistakes?
What Every Homebuyer Ought to Know About Avoiding These Common Home Buying Mistakes!
Keep Reading to Learn How to Avoid Them…
Little did John know, but he was preparing to make one of the most common and costly home buying mistakes a would be home buyer can make. John was excited about purchasing his brand new home and thought driving up in a brand new car would be a great idea.
The vision of the wind flowing through his wifes long blonde hair as they drove through their new neighborhood was too enticing for John. The mesmerizing ‘new car’ smell was irrestible and John drove off the car lot with a big joyful smile and a gleem in his smiling eyes.
Unfortunately, it was a short lived victory lap, as his smile soon turned into a depressing frown when his lender informed him his car purchase had disqualified him from obtaining the new home loan. The new car loan showed up on his credit report right before they were getting ready to fund the loan and close. A costly home buying mistake indeed.
The new car monthly payments were added into his monthly expenses and raised his debt to income ratio to a higher level, disqualifying him A very sad state of affairs, but this costly home buying mistake is an all too common one, I’m sad to say.
Home buying mistakes like these are very costly, but are not isolated to new car purchases. Home buying mistakes also occur when would be buyers want to prepare in advance and go out and finance appliances and furniture prior to close of escrow. Even making charges on your charge cards can increase your debt to income ratios enough to disqualify you for your new home loan.
Recommended: avoid these costly and common home buying mistakes by delaying all major purchases as much as possible until after you’ve purchased and closed on your new home. If you must make them, check with your lender first and have them advise you about the ratios to make sure you don’t end up spending the night in your convertible instead of your new home, like our poor friend John. (I would not want to be him!)
More Common and Costly Home Buying Mistakes…
As of late, many would be tenant buyers are making costly home buying mistakes by handing over their down payment money directly to the for sale by owner. Buying direct from the owner looks like a great deal, the price seems right and the owner was willing to work with you on accepting a fair rent until you were able to qualify for a loan to finish the purchase, but one of the most costly home buying mistakes was in the making, unbeknownst to you.
One day, typically a real estate agent, knocks on your door asking if you are the owner. You explain you’re the tenant and are purchasing the home from the owner and the agent goes on to inform you the owner has been foreclosed on, asks to view your lease and offers you a relocation assistance program to help you with your move from the new owners at the bank.
I’ve personally seen these type of home buying mistakes made time and again. One would be tenant buyer gave, not the real owner, but someone posing as the owner, their down payment money AND their first and last months rent.
Recommended: Use a real estate agent to help you avoid these common home buying mistakes that are running rampant right now with all the foreclosures happening. At worst, get your down payment money into a 3rd party escrow account, so access to the money can’t be gained by either party until either the house closes or the deal falls through.
Search the tax assessor and county recorder websites to find out who really owns the home and don’t ever hand over cash money to the owner, a very large and costly home buying mistakes. Screen the owner and get some credentials from them to prove who they really are and check the county recorders office to see if a Notice of Sale has been filed.
Common Home Buying Mistakes – Utilities Not Turned On…
Believe it or not, some home buyers actually forget to have their utilities turned on in their new home before they move in. Of course, Murphy’s law is in place and this usually is discovered on a Friday going into a weekend when no one is going to help you until Monday. That makes for a very uncomfortable inauguration into your new home, especially at 110 degrees in Phoenix, Arizona or in the dead of winter with no fireplace.
Recommended: make a note in your Outlook or Google mail arrange for two things to happen: (1) turn off utilities at your old residence and (2) get utilities turned on at your new home.
Avoid Costly Home Buying Mistakes…
Having a good real estate agent to look out for your interests as you go through the process of buying your new home is an extremely important asset you don’t want to overlook. Their services are paid for by the seller and they can literally save you thousands of dollars in grief avoidance with their expertise in helping you avoid not only these, but many other common home buying mistakes made by would be home buyers.
Their job is to keep up with all the details of the transaction from day-to-day, and keep everything moving smoothly and on track towards the exciting day you close and move into your new home. They can help protect your from a great deal of the frustration associated with buying a new home. They arrange home inspections, remind you to turn on utilities and keep things on track and help you stay up with the requirements of the lender as the home progresses to closing too.
Home buyers who fail to do this find themselves way behind in the process at the very last minute. This leads to delays or even cancellation of the transaction. Recommended: take care of your side of the street by staying on the same page as the lender all the way through the homebuying process.
The more educated you are about the potential home buying mistakes you could make when buying a home, the better chance you have to keep the entire home buying process cruising along smoothly toward a successful close of escrow. By the way, after you’ve got your keys to your new home and you want the wind blowing through your hair in that new ragtop, go for it knowing you have avoided those hazardous, but costly home buying mistakes.
Joe Martin is the leader of the #48 RE/MAX team in the world, has closed over 800 homes in the last 30 months and has written a special report on 6 things you MUST know before you buy your next home. For a limited period, you can get a free copy at his real estate home information center. Direct questions can be asked at his Ask Joe weekly Vlog or on his blog site.
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