~~~Don't lose a home by making these common home buying mistakes~~~
It is the beginning of a new year and many people are setting goals, reviewing their expenses, creating new budgets and are starting to think about the upcoming home buying season. Those who have waited for the holiday season to pass and are now ready to jump into the home buyer game should avoid these common mistakes that could jeopardize their purchase.
1) You didn't get pre-approved and were shopping outside your price range. This is a big one. Always start your home search with a pre-approval from your lender. This way you know exactly what you can afford. Often times home buyers have a hard time staying on budget, especially when searching for homes online. Knowing exactly what you can afford will help you narrow your home search and will save you a lot of time and heartbreak should you find the home of your dreams but you cannot afford to buy it.
2) Submitting lowball offers in a hot seller's market. Housing inventory is low in Northern Nevada, making it a seller's market. For many sellers, even those who have had their house listed on the market for a while, the low ball offer can come across as frivolous, or even be insulting. If you are truly interested in a home, bidding so low can actually backfire badly. Insulted sellers are less willing to negotiate and in many cases are not even willing to counter. Be smart about your offers. Trust your real estate agent to help you craft a competitive and fair offer.
3) Making a big purchase while in escrow. Don't make large purchases while in escrow. Mortgage Lenders often run last-minute credit checks and a new credit line could jeopardize your final mortgage approval. This is often a hard one for home buyers because buying a new home is very exciting. Once you have gotten past the contingency period and things are looking much more definite, sometimes it is easy to think closing is a done deal. But it is not. Those home purchases, appliances, washer, dryers, cars, trips, all could cost you your new home. Large withdrawals from your checking or savings accounts are also huge red flags and could derail your transaction.
4) Forgetting to budget for closing costs. Buyers don't just need money for the down payment. There are a lot of extra fees at closing, too. Make sure you review your estimated closing costs for your mortgage with your lender and Realtor. While these costs vary from state to state, here in Nevada closing costs typically range from 3% to 5% of the home's purchase price. Some of these fees include, but are not limited to, the appraisal, credit report, home inspection, pest inspection, title fees, escrow fees, home insurance, HOA set up fees, etc. Compared to the overall cost of the home you are buying, the closing costs are just a minor portion. But if you don't know what to expect at closing, these costs could be very overwhelming.
5) Not hiring the right Realtor® to help you with the home buying process. Purchasing a home is not only a big decision and extremely large investment, it’s also a complicated and detailed process. Learning about different neighborhoods and what they have to offer to find the home you want to purchase is just the tip of the iceberg. You’ll be signing a legally binding contract that has multiple deadlines to meet and contingencies to fulfill. Hire a local expert that you feel comfortable with and trust to guide you through the process. Going at a home purchase alone is opening yourself up to both financial and legal risks. Not all agents are created equal and selecting the right one to represent you is imperative.
If I can help you with your home buying requirements, the home buying process or help to find the right lender for pre-approval, in light of your budget and other factors, or just answer any questions about buying a home, please give me a call or text me at 775-846-5424. Then we will get started on finding you the right home, for the right price and get you into escrow.