If you choose to follow a systematic approach to buying a home than watch out for these common home buying traps. You will certainly have a better home buying experience. This cautious and prudent approach can help you to cut costs while assuring that you get the best home for your needs and lifestyle.
Since purchasing homes in the Southern California area is a major investment, one needs to make sure people follow a few tips and steps to avoid the most common home buying traps associate to home purchasing. You don't want to get caught in these traps:
1. Paying too much for the home you want.
2. Actually, buying a home for the wrong reason or undefined needs.
3. Losing their dream home to another buyer because you haven't planned properly.
This report discusses the 6 most common and costly home buyer traps and how to identify them and more importantly, what you can do to avoid them.
1. Buying the Wrong Home .
Discovering what you want vs. what you actually need in a home is important in discovering what you can afford for the things you want. Most of us want all the amenities we can get, when purchasing a home but often do not clearly figure out what our dollar will buy in relationship to that question. You can purchase a new home and not get a manicured backyard, perhaps just dirt or we can purchase an older home with plenty of landscaping and old growth. The older home can often be a better bargain since the costs of landscaping can be quiet expensive. Plus, older homes often have more charm than brand new homes. Newer homes are clean and smell fresh of paint and have few scratches. Yet, they may not have the square ฝากขายทาวน์เฮ้าส์ footage as compared to the older homes. The lot sizes of newer homes are most often much smaller than those of older homes.
Newer homes often have Mello Roos assessments which have higher taxes on the home. So, my point here is to do your homework and ask a lot of questions of your Realtor. A good realtor will know how to explain all the benefits of each type of home and how to weight the value of purchasing each type. We see so many new home buyers working with other real estate agents or representatives, accept an offer and go into escrow and then have buyer's remorse while in escrow or look for other homes because the escrow is too long. In a "short sale" and REO market condition, only the smart Realtors understand and really help the buyer clearly define what they want in a purchase, ask all the important questions before taking a client out to search for home and make sure the client understands that part of the benefit of getting a great deal is having patience through the process. Banks are overwhelmed and often take much longer when going through a bank owned sale or short sale. Buyers have to have patience. Part of the responsibility of the Realtor is to make sure the buyer knows they are getting the home of their dreams and it's worth the wait.
2. Bidding Blind .
What actual price should a person offer on a home? How many times should they go back and forth and bid on a home? Is the seller's "asking price" too high or does it represents a good or great deal compared to other homes in the area. It's wise to research the housing market and define what a good deal should be. Seasoned Realtors can help to do that since they have all the most recent comparable data to define average and specific market value. Without concrete knowledge of both market conditions, community surrounding and offerings, school ranking and proximity to restaurants and stores, one could make a lesser quality choice in purchasing a home in certain areas. Offering bids for a home without doing your homework can mean the loss of equity and quality of life when bidding. Always, get the most current information that matter to you regarding lifestyle and short and long term economic conditions in your area, because it matters.
3. Not Getting a Mortgage Pre-Approval .
It is critical that you get a mortgage pre-approval before you start searching for a home. Having a certificate and being able to deliver that pre-approval certificate to the seller and their representative can mean an accepted offer against all those who have no proof of qualifications. This approach, often gives you negotiation power when up against those who are not mortgage loan approved. Also, if you are the only offer submitted, you can have a better chance of getting our offer accepted and get a better deal. Providing a pre-approval to the seller can also cause the seller to offer you some closing costs towards the purchase of the home and that can mean a huge savings to you and your family.
4. Unknown Closing Costs and Rushing through Escrow to Close .
One of the biggest mistakes that people make is to "rush" through the escrow process and sign all the paperwork without reading the documents presented. It is the fiduciary responsibility of all parties to a real estate transaction to make sure they acknowledge that documents need to be read and understood before signing them. Escrows are usually very through in making sure you understand the process of buying a home and what is needed, yet you should always rely on your seasoned real estate agent to answer any questions you have, including the HUD 1, Escrow instructions, total closing costs and all lender documents. The lender, escrow agent, title representatives, roofers, home inspectors and anyone else related to the transaction needs to be prudent and clear as to disclosure. Simply, ask questions and expect helpful answers. It will make the process of buying a home more enjoyable and the transition from start to finish, smooth.
5. Contract Miss-Understandings .
It is wise to let your realtor work on your behalf to make sure all contract details are acted upon to the tee per the agreements within the writing of the contract. If the seller fails to comply to the letter of the contract by neglecting to attend to some repair issues, or perhaps deciding to change the agreement in some way this could delay the final closing of your escrow. Let your realtor help you to get all the issues off the table and in the minds of all parties to the transaction. If you have questions about certain details of your escrow, purchase contract, etc., let everyone know about it. Open communication is the key and it certainly helps your agent to make sure the sale moves smoothly. The fact is that most transactions will close on time if everyone has open and clear communication. Few transactions happen to NOT close, if all parties to the transaction work out the issues. Really, most people just want to close the transaction and move on with their lives. Being clear and concise, make the process much smoother.
6. Undisclosed Fix-ups and other issue .
One of the most common challenges with people under contract and in escrow is the discovery process of the home, condo, townhouse, land sale, etc. While in escrow and under contract for the purchase, certain issues come up regarding the purchase of the home including the home inspection final details and assessments, possible title insurance disclosures, mortgage qualifying disclosures, etc. Remember, the process of buying or selling a home has to do with a "meeting of the minds" within the totality of the transaction.
Most issues are resolved quickly and negotiated to the benefit of all parties to the transaction. Your representative and the seller's representative will work with each other to come to an agreement that will suit all. If you have credit issues or money challenges when in escrow, let your agent know because they may have a solution that helps all. After all, they want to close the transaction too, so they will work hard to find a solution. We have seen many times that someone doesn't disclose a mortgage issue and it could have been solved by the Realtor but the home buyer thought that the only solution would be derived by their mortgage lender. No so! Talk to your Realtor! You will be glad you did. They might be able to work something out with the lender, the seller or a combination of all to get the issue solved and your escrow closed. We have been doing it for over 25 years. It works!
Bonus:
Make sure you take the time to go over all the documents which you will be signing. Have someone inform you about the documents which you don't understand. Only, sign those documents which you do understand. Have escrow, the lender or your Realtor answer any questions you need answered. Read the disclosures regarding the home inspection report, title insurance, escrow documents, mortgage lending documents, notary documents, final walk-through documents and anything else that is delivered to you for reviewing. We often complete an online webinar and go over the documents when needed for our buyers and sellers. People are busy these days and it is often wise and easy to just do an online meeting at the best time for all. It's easy, smart and everyone feels great knowing that everything is clearly understood. Real estate transactions run smoother, too!
If you're in the Southern California area and need an agent who looks out for your home buying or selling interests, consider our services.
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