Common Mistakes When Buying Real Estate
1. Not getting pre-qualified for a mortgage
Before looking for your next home, take the time to get pre-qualified by the bank or mortgage broker you choose. This can save you hours of searching for homes in the wrong price range, or worse, purchasing a home and then finding out you don’t qualify for financing. Pre-qualifying gives you peace of mind, helps narrow your search criteria, and most importantly, gives your RE/MAX agent a negotiating edge by being able to alleviate the seller’s concern over financing. The latter is especially important should a competing offer surface.
2. Not shopping for mortgage terms
Rates are negotiable! Banks will sharpen their pencils to get your business, especially if you have a good credit rating, and bring other business to them e.g. RRSP’s, a general account, savings, etc. Posted rates should be viewed as a starting point. You need to know what the best rate is and this is usually done by getting competitive quotes. Also, ask whether the bank will cover appraisal fees, and ask about buy-out fees, penalties, payment options, portability, etc. The time spent can save you thousands of dollars over the life of the mortgage.
3. Not getting professional inspections
Nobody wants to purchase a home only to find out later there are defects, latent or otherwise. Ensure you obtain inspections where needed e.g. home inspection, structural engineer, insect, radon, etc. If the inspection identifies deficiencies, you may be able to negotiate the purchase price to cover the required repairs. You may also be able to make your satisfaction of the inspection subject to the homeowner remedying the problem. Your Charlie Parker Team RE/MAX agent can advise you on inspections you should consider.
4. Not using a professional real estate agent
The Charlie Parker Team at RE/MAX can help you make a purchase with the least amount of problems. They can ensure the price you pay is market value and offer expert advice on what to look for, conditions to include, negotiation strategies, etc. After all, they work for you.
5. Buying first before selling
If price is important, you should always sell your present home before buying another. This has the advantage of letting you know exactly how much money you will have available for your next purchase. Selling your home first allows you to place fewer conditions on your purchase, making your offer more attractive to a seller. Sellers will often demand more money to take a “subject to” offer, which takes their home off the market. The other advantage is if you find a terrific house, chances are others will also find it attractive and you stand to lose it if you can’t make an unconditional offer.
6. Not knowing the full cost of home buying
Know all the costs associated with your purchase. It is important to consider the following costs: legal fees, property transfer tax, property taxes, foreign buyers tax, speculation tax, new home landscaping, fencing, appliances, window coverings, etc.
Before you make a costly buying mistake in purchasing your next property, contact our team to find out how we can help you navigate the complicated world of real estate.