Homebuyer Traps to Avoid
- By researching the market before you make an offer, you can avoid the mistake of “bidding blind”. It is so important that you do your homework, and know the price of comparable homes selling in the area. A good real estate agent can be invaluable in this process.
- It is so easy to get caught up emotionally in the excitement of buying a home, but it is critical that you first consider what you want in a home. This can be a complicated process as you make decisions about size, style, location, floor plans, neighborhood and other issues. Take the time to carefully detail exactly what you want in your home.
- A clear titles an absolute must. How upsetting it would be to purchase your dream home, only to find that there are liens on the property, undisclosed additional owners, easements, or other complications. A complete title search is a critical part of the home buying process.
- When making an offer on a home or lot, be sure the boundaries are clearly identified and you may want to make sure with an up-to-date and accurate property survey. One example, of property lines becoming a later dispute, might come over the possibility that during construction one of the stakes might have been taken out by a child at play to be put in a different spot. Later, your neighbor decides to put a block wall in and finds out that you are encroaching with your landscaping onto his property. Additionally, if the survey on file is old, it may not show new fencing, additions, or other changes to the property line. Be clear on whether or not you will want a survey conducted at your own expense. Some extended coverage policies of title insurance may (perhaps with a deductible) also cover later boundary disputes. The main thing is to be informed about your options going into the purchase.
- A thorough home inspection is another critical item not to be overlooked. This should be done early in the buying process, so that you can view the home objectively, and not be swayed by surface décor or other attractions. The final contract should definitely be contingent on the outcome of the inspection, and the inspection report should include the approximate cost of any needed repairs.
- Especially with new construction, a clause in the contract will include an escrow fund in the event the seller fails to comply with needed repairs. This can also be negotiated at the time of doing a home inspection and making objections. These are the times to get your concerns met with the contingency put in place of monies to be pulled out from escrow, prior to closing, if they have not been completed. Complete a list of agreed-upon concerns, do a walk-through, and check off these items one at a time. Then, if the seller doesn't comply or has not finished with the agreed-upon repairs, there will be a fund in place to cover these items. A good realtor will help you put such contingencies in place, so don't let yourself fall into the trap of leaving it undone.
- Take the time to identify any and all costs, both large and small. You don’t want to be caught at closing with a number of “hidden” costs that you had not planned on or anticipated. This can be avoided by having your lender give you a written estimate of the anticipated total charges.
- Prior to closing, take the time to review all paperwork. This should be done a day or so before the scheduled settlement date, so you are not rushed in this process. Now, most "closings" are rushed with documents, up at the last moment. So, place a call before deadlines to your title/escrow officer to make clear your expectations and that you would like a Settlement Statement a day or so, before your scheduled settlement date. Your realtor will be able to get you their name and phone #, if your don't haveit. This will give you time to address any issues before the actual settlement/closing occurs. Otherwise, you will have fallen into the trap that most do, at the last minute, wondering and hoping while signing that everything is "Kosher".
- As you can see with the above issues, a qualified real estate agent is a critical component of the home buying process. Don’t shortchange yourself by trying to handle all of these items on your home. Seek out and work with an excellent real estate specialist who can guide you through your home buying experience.