1. Trusting tax assessments
Some people think that tax assessments are a way of evaluating a home. The difficulty here is that assessments are based on a number of criteria that may not be related to property values, so they may not necessarily reflect the homes true value.
2. Bidding without knowing
What price should you offer when you bid on a house? Is the seller’s asking price too high? Are in front of a real deal? Before making one the biggest purchases of a lifetime, you should take a very close look at the real estate market in the area you’re a thinking of purchasing. Without the knowledge of the real market value of the houses you intend to visit, and ultimately purchase, your are more than likely to make a blind bid.
3. Getting the wrong house
Simple questions, like what do you want in a house, can have pretty complex answers. A lot of buyers get all excited at the prospect of finally owing their house. So excited and emotional, that sometimes they end up being the owner of a house that does not answer their needs. The house may be too big, or too small, or it’s too far from work, or what looked like just a few small renovations is much more then expected. Take time now, before the buying process, and define what you really want in your house. Write it down.
4. Unclear house title
As soon as you start negotiating your new home, make sure that it is free and clear by having a title search done. One of the last things you want to learn later in the process is that there are taxes, leases or other liens on the property you are about to own.
5. Incorrect survey
When you make your offer to purchase, you have to make sure you request an up to date property survey that defines very clearly the boundaries of the property. You never know what type of changes may have occurred since the last survey (i.e. swimming pool, extension to the house, fence, etc.)
6. Surprise fix-ups
You just can’t expect every seller to sell their home it perfect condition. Remember the old saying: Buyer beware! You have to ensure that a complete inspection of the house is done before you sign anything. Or if you do sign, make sure it is conditional to your entire satisfaction after a house inspection. An independent inspector will check the house inside and out and give you a report outlining the items that needs to be fixed with the associated costs.
7. No pre-approval
You’re not pre-approved! What are you waiting for! It’s fast, it’s free, and it’s easy. Once you have a pre-approved mortgage, your house shopping is much easier. You will feel free and secure because you will know that the money you need to purchase your deam house will be there when you need it.
8. Seller neglect
If the home seller fails to do some repairs or to comply to any part of the purchase contract you will feel very frustrated. One way to avoid this is to agree, in the purchase contract, to put a fixed amount of money in an escrow fund that will cover the items the seller was supposed to attend to.
9. Hidden charges
Before you make your offer, make sure you made a list of all the costs associated with the purchase. The typical “forgotten” cost is usually a forgotten loan disbursement charge of some sort of underwriting fee. One way to avoid any hidden charges is to have the lender give you the total charges in writing.
10. Close too fast
This is a critical part of the whole buying process. Take your time, read all the paperwork a day or two before you sign. Have a lawyer go through it and make absolutely sure that all the paperwork reflects the transaction your are about to do. Double check everything, it’s the best way to avoid a forgotten clause or to notice, too late, that something has been added or subtracted. If there is a problem, you will have a hours to solve it before the closing day.
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