Common Mistakes Made When Buying Property
1. Forgetting pre-qualification
A common mistake made by homebuyers is not taking the time to get pre-approved by a bank a mortgage broker. This can result in countless hours spent searching for homes out of your price range, or worse, purchasing a home only to find you don't qualify for financing.
Take the time to get pre-approval as it will save you time in the long run. Pre-approval helps narrow your search criteria and gives you an edge when making an offer by alleviating the sellers concern over financing. The latter is especially important should a competing offer surface.
2. Not Shopping For Mortgage Terms
When financing your home, researching mortgage rates is a must. A lower rate can either cut your monthly payments significantly or allow you to choose a shorter term and pay off the loan sooner.
Rates are negotiable! If you have a good credit rating and can bring other business with you, banks will compete for your business. Take the time to find the best rate on offer by seeking competitive quotes. Additionally, ask whether the bank will cover appraisal fees, and about buy-out fees, penalties, payment options, portability etc. The time spent can save you thousands of dollars over the life of the mortgage. To learn more about property finance, speak with RE/MAX Australia's finance partner Australian Property Finance.
3. Not Investing in a Professional Inspection
Nobody wants to purchase a home only to find out later there are defects, latent or otherwise. Ensure you obtain building and pest inspections. If the inspection identifies deficiencies you may be able to negotiate the purchase price to cover required repairs or make your satisfaction of the inspection subject to the homeowner remedying the problem. Your RE/MAX agent can advise you on inspections you should consider.
4. Not Using A Professional Agent
RE/MAX can help you make a purchase with the least amount of problems. The price you pay is market value. They can offer expert advice on what to look for, conditions to include, important local information etc.
5. Buying First Before Selling
If price is important you should always sell your present home before buying another. It has the advantage in 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 which makes your offer more attractive to a seller. They often will 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 Buying
Know all the costs associated with your purchase. Consider the following costs: legal fees, transfer tax, property taxes, new home landscaping, fencing, appliances, window coverings.