10 Mistakes Home Buyers Must Avoid

10 Mistakes that Home Buyers Must Avoid

• Not Understanding Your Buying Power - The first step in Home Buying is not going out searching for housing options, but rather is exploring financing options and determining your buying power. 
• Thinking you can steal a Foreclosure - Some Foreclosures can be purchased under the bank's asking price, but it is a mistake to assume that "because it's a foreclosure" you can offer 50% of the asking price and hit the jackpot.  In most cases, the asking price by the bank is the result of a market analysis, broker price opinion and an appraisal.  The bank is not guessing at values. Chose an agent with an SFR (Short Sales and Foreclosures Representative) designation which assures the Buyer that the agent has taken the extra education that is needed when dealing with Short Sales and Foreclosures.
• Keep your emotions in check (Special Warning to First-Time Buyers) -  Purchasing a home is an exciting process.  It comes with many twists and turns.  Keeping your emotions in check is crucial.
• Underestimating the Value of a good Buyer's Agent - A buyer's agent has a client level responsibility to you as a Buyer.  A knowledgeable and competent agent will guide you every step of the way and protect you from the commong mistakes on this list, and negotiate the best buying price as well.  Be sure to select an agent with a designation of ABR (Accredited Buyer's Representative).  The ABR designation assures you that the agent has taken the necessary courses above and beyond the basics.
• Underestimating Cost of Owning - Yes, yes, yes, it makes incredibly good financial sense to own a home instead of renting; however, in the course of each year, there will be expenses that you more than likely diidn't have as a renter.  There will be repairs, taxes, maintenance costs to name just a few.  Be sure to take all of these expenses into account when you decide how much you can afford when purchasing a home.  Also keep in mind where your are purchasing your home.  If you are moving to a different area of the country, there may be addition expenses.  In the northern states, snow can be a factor, while in the Southern states, you may have to replace a/c and heating components more frequently than in the north.
• Property Tax Pitfall - Be sure to budget your property taxes on a monthly basis.  Quite often it may be an escrow item that you pay with the mortgage, whichever way they are paid, just make sure you have a good idea of what taxes will cost for a particular property.  Property taxes are separate from the general cost of owning a home for this reason:  Sometimes you can delay the expenses of maintenance and repairs, but you MUST pay your taxes or Uncle Same will kick you to the curb in a hurry!   You also need to be prepared for a Tax Evaluation periodically.
• Assumption that your Offer will get Accepted - Buying a home is a process and part of that process is offer and acceptance.  You, the Buyer, make the offer, but the acceptance by the seller is not guaranteed in any market.  Be patiient.  A good Buyer's agent (especially one with an ABR designation) understands this and will help you find that home even if it takes two or three offers on different properties.  First-time Buyers must understand that once you put in an offer and it is accepted by the Seller, it is a Binding Contract.  Be sure, as a Buyer, that your initial offer is what you can and are willing to pay.
• Skipping an Inspection - It is very rare that you would want to skip a home inspection by a qualified and licensed inspector.  Even though the law requires sellers to disclose any problems, visible or invisible, sometimes they are not.  Your realtor can help you locate an inspector, but be sure to qualify them yourself.  It's YOUR future home!
• Don't make your house a home too fast - I know that sounds crazy, but don't be too quick about putting a lot of upgrades and personal touches to your home, especially if doing so on credit.  In today's market it is harder than before to get the dollar vallue out of improvements.  Also, try living in the home for six months before you make any changes.  You might find that the flow of the rooms or the design of the home works well. 
• Not protecting yourself in the offer - Here again a good Buyer's Agent will be of great value to you (preferably one with an ABR designation).  There are many variables to consider.  From job loss to financing issues, appraisals, home inspections, etc.  The list goes on and on.  Be certain to discuss your concerns with your ABR agent.  If done correctly, this will save your earnest dollars.

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