Top 13 Mistakes Buyer's Make:
In today's market we all know that it has been a Buyer's Market, there is more inventory than ever before, but to purchase a home the Buyer needs to be educated on the housing market. Not every city or neighbor is the same, and some area's are selling better, home values are the same or increasing. There are still many area's that are not selling well, and home price have decreased signficatly. So for a Buyer to be well informed the best source of information is from a REALTORS®. As REALTORS® we have to take courses to get our real estate license, and we also have to take continuing education courses to maintain our license. Being a REALTOR® is very time consuming, but also very rewarding. We work hard to stay up on market conditions, and help families find their dream home.
1. Not using a REALTORS®:
A very big misconception when it comes to buying a home is that you will pay more if you use a REALTOR®. The reality is that the REALTOR® fees (both buyers and sellers agents) are typically paid out of the sellers proceeds. This means that it cost you nothing more to have a trained professional help negotiate on your behalf.
2. Not getting Pre-Approved BEFORE looking at properties:
Going out and looking at homes if fun. But if you don't know how much you can afford, you might fall in love with a home that you can't qualify for; or even worse you can qualify for but the payment ends up making you "House Poor".
3. The Buyer's has purchased several homes before so they don't want to listen to the
Times have changed over the past several years with the housing crisis, and they way we purchase homes today is vastly changed. REALTORS® know the housing market, we do this for a living. So trust in your agent to provide you with information to make a well educated decision.
4. Buyer's can save money by not using a REALTORS®:
That is a myth! A Buyer can purchase from For Sale Buy Owners, but not always does the homeowner disclose all the information regarding the home. By using a
REALTORS® we are required to disclose all information regarding the home. I want to build a new home, and the Builder will give me a discount if I don't use a REALTOR®. I wish that were true the REALTOR® commission are already figured into the price of the home. By using a REALTOR® we negiotate on your behalf, and make sure that the building process is completed and you end up with the home that you dreamed of.
5. Buyer's want a great deal:
There are great deal's out there, but the Buyer needs to be realistic. Home prices have dropped, there are foreclosure, and short sales. In getting the great deal that also causes the home prices to drop. The Buyer does not think that if you low ball an offer, and the seller has to sell they take the offer. The other homes in the area are priced higher, now because you just got a really low sales price you caused the other seller's to possibly lower their price know the value for your home just dropped. The Comparative Market Analysis is based on current homes sold, so if your home was really low then the other homes are not over priced. Buyer's Market is not only about getting a great price, but is also about a great interest rate.
6. Make a new substantial purchase (car, truck, new furniture, big vacation) right before or during the process of buying a home:
If you are really serious about buying a home, you need to put other big purchases on hold. These big purchases could easily prevent you from buying the home you really want, by increasing your debt to income ratio too much.
7. Ignore past credit issues rather than correcting/repairing them:
It would be nice if inaccuracies or other credit problems would just go away if you ignored them but they don't. Today's lending market is getting tougher and tougher to get a mortgage. Old delinquent accounts on your credit report (even if it is wrong) can prevent you from buying the home now.
8. Listen to friends/neighbors/family advice rather than trusting their professionals
REALTORS® and Mortgage Brokers must go through hours and hours of education and licensing requirement to hold those titles.
If the professionals you have chosen to work with are giving you advice, it is probably a good idea to listen to them. The people who earn their living in the Real Estate Industry are much more qualified to give you advice than most friends and family members.
9. Expecting REALTORS® or Mortgage Broker to cut their fees or Trying to Start a Bidding War between REALTORS® or Mortgage Brokers:
There are some things in this world that you can benefit from by getting two service providers in a bidding war, BUT BUYING A HOME IS NOT ONE OF THEM! The most skilled and experienced professional in the Real Estate Industry refuse to compete on price. Instead, these professional compete on quality of service. Remember, you always get what you pay for.
10. Not being fully honest (full disclosure) with your Mortgage Broker about past financial problems:
If you have had a financial problem in your past, your Mortgage Broker needs to know about it up front. Many problems in qualifying for a mortgage can be eliminated or worked around if they are dealt with in the beginning. Nothing will kill buying a new home faster than unexpected problems arising from lack of full disclosure.
11. Expecting to buy the best house for the cheapest price:
Nothing is forever, you might have to buy and sell one or two properties before you get your dream home. When buying a home, you need to be realistic about what you can comfortably afford. If you are pushing the limits of what you can afford, what are you going to do when you hit a rough patch; and yes, you will hit a rough patch.
12. Jump from one Mortgage Broker to the next:
In the beginning, you need to decide what Mortgage Broker you want to work with. Jumping around will only complicate the process. Find a Mortgage Broker that you can trust will deliver on their promises and charges a fair price and work with them.
13. Not collecting and supplying requested documentation to your Mortgage Broker ASAP:
Getting a mortgage now can be a lengthy process. If you are not quick to get requested documents back to your Mortgage Broker, it will only make the process even longer. Be prepared with the basics (2 years of full tax returns and w2s, 2 months of all bank statements, 30 days paystubs, explanation and documentation for special situations such as bankruptcy, foreclosure, credit inquiries), but also be ready to get updated or additional document as they come up.
When using a REALTOR® not only do you get a great home, but you get peace of mind that you were well educated in the home you bought. It is better to find out all the issues of the home, and contract before you close and give up money to buy your home. Once you close if there is a problem with the home that is now your problem, and if your not careful it can be an expensive lesson. Honestly when you buy your home, do you want to have worry something might go wrong? No you want to enjoy your new home, using a REALTOR® is a wise and smart decision.