5 Surprise Pitfalls First-Time Home Buyers Can Avoid
Buying a home, especially your first home, should be an exciting and joyous time for the whole family. No more paying rent so someone else can pay their mortgage, you finally have the chance to grow your own nest egg by building equity in your home each month. The excitement of the new home and the thought of starting new often clouds the judgement for new home buyers, and they tend to get too emotionally attached when they find their dream homes for sale before doing their due diligence. Here are some of the unexpected things that could go wrong when buying your first home and how to avoid these pitfalls;
Getting Tied Up in a Short Sale or Foreclosure
Buying a short sale or forclosure can be one way to purchase a home below market value, but its not for everyone. There is MUCH more to the purchase of foreclosures and short sales than simply making the repairs after you have bought the home. When you make an offer on either, a bank has to approve the offer. This causes major delays in comparison to purchasing a home from an indevidual. In many instances, you can attempt to buy a short sale or forclosure for months and never get to an act of sale. During that time, you very well could be missing a great deal on the perfect home!
The House is Sold From Under You
One of the reasons it is so important you are working with skilled real estate agents when buying your first house is because they will work in a timely manner to make sure you get the house of your dreams. If you are working on your own, or with a realtor lacking experience, things tend to drag along slowly. During that time, another aggressive realtor could bring their clients to the house and present an offer that the sellers appreciate more.
Until the contracts are signed, the homeowner's realtor is going to continue to show the house, and last second deals are not rare in this industry. While you are taking your time getting your affairs in order, a realtor with a client who has their funding and closing documents in order could literally take the house from under you.
The Mortgage Company is a Nightmare
There are hundreds of mortgage companies today that promise lower rates and faster processing times, many of these can be found online without even stepping foot in the bank. The first-time buyer is naive if they believe all mortgage companies are the same. Even though your credit checks out and you have your mortgage commitment in hand, this doesn't guarantee things will play out perfectly. Many of these new online mortgage companies spring up today and are gone next year.
If you are a first-time buyer and you select the wrong financial institution, things could take too long or fall through at the closing, costing you the chance to own this house. Your realtor has been in this business long enough to know which mortgage companies deliver on their promises and have helped other buyers to close without incident on the date agreed upon by buyer and seller. Selecting a mortgage company based on a cute commercial or online advertisement is no guarantee they can deliver on closing day.
The Neighbors Spawned from Hell
When you are selling your home, you try everything to make certain your home is as appealing as possible to potential buyers. While many of the things that are concealed from the buyer inside the home can be revealed by a qualified home inspector, it is the things in the neighborhood that require some due diligence.
If the neighbors are loud, have rowdy kids, or noisy pets left outside all hours of the day, the homeowner could talk to the neighbors about keeping things more low-key on days showings are scheduled. If these neighbors are close friends, they might ask them to disappear on the date of the open house, to give the neighborhood more appeal by making it seem quieter.
As the buyer, your job is to make the effort to check everything for yourself. Park your car on a Saturday afternoon around the block, and walk the neighborhood to see for yourself. Come back different times of the day or night, because if you hear loud barking dogs after dark, there is a good chance you are going to be dealing with them for years to come.
Your Home Inspection Service Pencil Whips Their Report
Just as all mortgage companies are not equal, the same can be said of home inspection services. A reputable and well-trained Home Inspection Services company will thoroughly examine all structural and mechanical systems of the house from roof to foundation and report their findings to the client. The report should include all findings, large and small, identify which items require immediate attention, and which findings may not need any work at all, but do not meet specification.
Hire a reputable and certified Home Inspector to be confident that the property has no damage or defects that would devalue the home or affect the health and safety of the new occupants. Unfortunately many Home Inspections companies are neither reputable, certified, nor well trained. Often the biggest problem faced when hiring a Home Inspector with loose standards is that these companies will schedule too many inspections each day to make more money, then cut corners and miss details that will affect the buyer soon after they purchase the property.
If the electrical or plumbing systems show signs of trouble and are missed by the inspector, the buyer is on the hook after the closing. Your realtor knows of several reputable home inspection companies they can recommend that will deliver detailed reports about the status of the house and warranty their work as well.
Choosing the Wrong Location
When you are selling your home, your job is to present the house in the best possible light. As a first-time buyer, you need to be doing more than simply taking everyone at their word. The house is stunning, the location quiet, and the seller says the surround preserve is protected and no building can be done for years into the future.
Too many buyers discover that after the excitement of moving into the new house is gone, things are not always as they appear. The developer is expanding, and building fifty more houses adjacent to your yard. A new commercial builder is tearing down that wooded lot to build a noisy industrial complex. Don't take anyone's word or assume the land around your home is not going to be built on in years to come. Go to the township and request information about empty lots, developer plans, and protected greenways. This way you can make a more informed buying decision if you know the property near your home is scheduled to be built upon.
With the help of a professional real estate agent, buying a home is easier and you will be less likely to experience any of these problems. Your realtor has seen just about everything in this industry, and will be in the best position to help navigate troubling waters before they sink your dreams of owning your first house.