Common Buying Mistakes
Choosing the Wrong Realtor
As a buyer in real estate you don’t pay a real estate commission directly to your agent, this is typically taken care of by the seller out of his proceeds at the closing. But in the long run a REALTOR® with experience and many closed transactions will cost you much less than someone who is inexperienced or unknowledgeable!
A top producer’s business is built on repeat clientele and referrals because they have proven they know how to select a great home for their buyers and negotiate the best price and terms. Your agent is not your best friend, your agent is your financial advisor for what may be the largest single transaction in your life!
Location! Location! Location! You’ve heard that over the years and it still holds true. You can always change a home’s decor and some of its structural features, but nothing can ever change its location. Buying a home in a poor location guarantees minimal (if any) appreciation and it will be hard to sell in the future.
Not Having a Home Inspection
A home inspector can literally save you thousands of dollars! They will check all structural, mechanical, electrical, plumbing and heating and air conditioning systems for defects the homeowner may even be unaware of. They will help prevent you from purchasing a home with a major defect or one which requires too much corrective maintenance.
Choosing the Wrong Lender or Loan
The wrong lender or the wrong loan program for your particular circumstance can lead to the loss of big bucks! For example, if you know you are going to be in your home only a couple of years before that next job transfer or retirement, why pay all your closing fees up front? Often you can save thousands by raising the interest rate you pay by half a percent. Your monthly payment may be a bit higher, but you may save $2,500 to $5,000 overall. A good lender will take the time to find out what works best for you!
Not Having Your Own Agent
You should always have your own agent in a real estate transaction! A new home is no exception – it costs you NOTHING and a good agent will be able to save you money on loan fees and upgrade options.
Buying a Home You Can’t Afford
Always go by the lender’s guidelines when deciding how much house you can afford. If you stretch too much you may find yourself in a financial bind which forces you to sell your home. A forced sale almost always guarantees a loss.
Buying a Home You Don’t Like
You have to live in your home, not your mother, your father, your big brother, your best friend and not even your REALTOR®! Make sure the home your purchase is the best one for you that you can find within your price range.
Article by Diann E. Tonnesen, Realtor®
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