It is not uncommon to make daily mistakes while going about our everyday routine. We forget our coffee on the kitchen counter at home. We call someone by the wrong name. Or we accidentally forgot to send that one e-mail before we left work. It happens to the best of us.
But many small mistakes can lead to bigger issues, especially when buying a home. There is a lot on the line when making a huge purchase such as a house, so it is important to know how to navigate the process. To better help you with this, here are six common ways home buyers botch their prospective home purchases.
1. Going at it Alone
If this isn’t your first rodeo you might be tempted to fly solo during this process. But we need to remind you it is a tricky process and hiring a real estate agent can be extremely beneficial when it comes to negotiating and making sure you get the best deal possible. Using a buyer’s agent is usually free of cost because the seller pays the commission for both the seller and buyer agents.
Avoid all the hefty paper work by browsing our dedicated team of realtors who will ensure that you do not make any costly mistakes in the home buying process.
2. Taking Away Your Negotiating Power by Saying too Much
When attending a showing of a potential property, be mindful of what the listing agent can hear. For example, if you let on to your partner that the house is everything you are looking for and under budget, the seller now has the upper hand when it comes to negotiating price. Keep those type of comments for private conversations.
3. Waiting too Long to Make Your Earnest Money Deposit
An earnest money deposit is a stipulation stated in the sales contract where you provide cash upfront to show your seriousness in the property. This is usually 3% to 5% of the sale price. The amount of time to provide the deposit varies by state. In Florida, the broker must deposit the money into escrow within 3 business days of receiving it. If you sit on your EMD for too long you will end up voiding your contract and you can say goodbye to the home.
4. Failing to Read Property Disclosures
Whether or not you plan on having the home inspected, the property disclosures are a crucial piece of information to read in full. This is where the seller lists any pre-existing issues within the house.
This is something that is usually provided to the prospective buyer(s) after the offer has been accepted. The issues that should cause major concerns are foundation problems, a leaky roof, HVAC issues and pest and mold infestations. Make sure your real estate agent works with the listing agent on any areas of concern in the disclosure statement. Some of these issues may have already been rectified which the seller can then in turn provide that information.
Also note that the added risk of any issues with the home can provide for a good advantage in negotiating down the price due to the inconvenience factor.
5. Letting Your Credit Slip While Under Contract
Aside from the rare circumstance that you are buying a home for full in cash, you will have to have your mortgage approved through an underwriting process. This happens shortly before the closing so make sure not to do anything that may hurt your credit score while under contract such as financing large purchases like a car or boat. And especially stray from applying for a new credit card. The inquiry may seem like a small hit to your credit, but it could very well make all the difference in qualifying for a mortgage.
6. Trusting a Verbal Agreement
Everything must be in writing in order to be official. If the seller makes a verbal promise to have something fixed, it’s just that – a promise. The agreement is made when it is in writing so that way the seller is required to take that action.
This is an issue seen a lot when potential home buyer’s do not utilize a buyer’s agent, especially in new construction. The builder’s agent will always be keeping the builder’s interests at heart.
Visit our buyers page to gain even more insight into the services an agent can provide you in this process.