August 29th, 2018 11:11 PM by Jackie A. Graves, President
Navigating the real estate market can be
tough. It's only natural that some people are going to make missteps. With that
in mind, I went straight to the source and asked industry professionals to
share their experiences with the biggest mistakes that buyers make. Read on to
learn how to avoid making one of these all-too-common pitfalls.
Not meeting with a lender
"I'd say the most common
mistake I see first-time homebuyers make is not meeting with a local lender
right away. I believe a lot of people worry about ‘wasting’ the lender’s time,
especially if they aren’t ready to buy immediately. I try and counsel clients
to understand that the earlier they consult with a lender, the better.
Sometimes it takes a long time for people to qualify for a loan and that’s
okay. Lenders are almost like free financial advisors and can help buyers
develop a plan to get to their goals."
- Keren Tsubely,
an agent with 8z Real Estate
too much on the advice of family and friends:
has the possibility of upsetting some people, but one of the biggest mistakes
buyers make is listening to their family and friends about their real estate
experiences. What buyers need to understand is that every transaction is
different. When well-meaning family and friends give advice, they do it
with the best intentions, but rarely do you give the details of their finances
or their circumstances.
Real estate is personal and regional. What works in one state,
doesn’t necessarily work in another state. Or, what a homeowner experienced
three years ago, may not be relevant to current market conditions. Seeking
advice from family and friends rather than industry professionals - who
know their unique circumstances - could be a set up for frustration and
Miles-Crocker, the founder of Real-Life Real Estate Training
for the 'perfect' home to arrive:
"In a competitive market like the one
we're in now, no buyer is going to be able to find everything they want in
a home. They need to be clear on which features they may want, but are
ultimately able to live without. If not, while they are looking for the perfect
home, the property they may have been able to make into their ideal home
will be gone. While they may not like the kitchen or bathrooms to start, it's
much smarter to consider whether they could move in, live with them for a
while, and upgrade later. "
- Jane Peters, the
Broker/Owner of Home Jane Realty
off more than they can chew, financially:
"If new homeowners think the mortgage
will be their only cost, they’ll be in for an awakening. They should make sure
they have the monthly budget to cover regular, as well as unexpected
maintenance items. For example, will the house need a new roof, water
heater, HVAC, windows, or exterior siding in the next 3-5 years? In addition,
there's also property taxes and HOA fees to consider. Buyers who make the
mistake of not accounting for these costs upfront can end up feeling 'house
- Randy Mintz, an agent
with R.E. Shilow Realty Investors, Inc.
on a 'shopping spree' after applying for a mortgage:
"Many buyers jump the gun after their
offer has been accepted and go furniture shopping or book a vacation. But,
that's a mistake because it hurts their chances of getting a mortgage. Going on
a shopping spree will create a new debt to income ratio if those purchases are
financed, potentially causing their mortgage application to be denied.
Moreover, even if the buyer does not finance these purchases and pays cash, it
will diminish their cash reserves which the underwriter for the bank or lender
may look negatively upon.
The lesson: It's crucial to keep your
finances as steady as possible during the underwriting process."
- Vincent J. Averaimo, a
real estate attorney with Milford Law
a real estate blogger and content creator from a family of Realtors, home
buying and selling is what I know. In addition to Forbes, my work can be found
on Realtor.com, ApartmentTherapy.com, and Freshome.com. I also work with
individual real estate agents to boost their d...
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