Buying a home? We’ve seen so many home buyers who are excited about buying a home – but are concerned that they might miss something important in the hunt for the home that really appeals to them. Because of that, we’ve put together some of the biggest mistakes we see home buyers across North Carolina make.
These are five things we think you should be aware of before you negotiate a contract, and exchange deposits with a Seller. Our “Biggest Mistakes Home Buyers Make List” so to speak.
1. Mistakes Home Buyers Make: Not Working Off A Long Range Budget
Figure Out your Budget: Before you start looking for a home, you need to spend a few minutes considering your budget – now and for the next 3 or 4 years. This is more than just talking to a loan officer and getting pre-approved for a mortgage. Most of those conversations end with a buyer finding out the maximum loan amount they can qualify for.
Talking with a loan officer about the fact that you just got married – and you think one of you will be quitting your job in the next 18 months, could make a difference in what price range you want to be looking at. Give the loan officer as much information about your Budget, and your financial goals so that you can do more than just know what the “top” number is you can qualify for today.
2. Big Mistakes Home Buyers Make: Not Exploring All Financing Options
Consider ALL of your Options: We recently had first time home buyers who were getting a gift from parents. As we talked through their budget, we learned that one of them had a whole life insurance policy with enough cash value to put 10% down on the home! This saved them thousands of dollars in PMI that could be cancelled once they were below the loan to value ratios!
Be sure you look at all of your investments, including monies in your 401K. Sometimes, these reserves won’t be needed for a down payment, but might help in negotiating a little better term on your mortgage, or help you qualify for your dream home!
Are you or your spouse a Veteran? Make certain you discuss your VA Home Loan Benefits with your loan officer. Often times, Veterans do not consider the fact that they can purchase a second home with their VA Home Loan Benefits.
Did you know that there’s a Mortgage Tax Credit still available? Many lenders in North Carolina do not offer the program, we do… learn about the benefits available if you haven’t owned a home in the past three years!
3. Big Mistakes Home Buyers Make: Not Seeking Buyers Representation
Writing a Contract Without Representation: So many first time home buyers think that they will get a better deal if they just negotiate with the Seller’s Agent. The onsite agent for the Builder is very knowledgeable about the homes offered – but they still represent the BUILDER. If you are a first time home buyer, there are some things about this home buying process that you need to learn – and working with your OWN real estate agent (that’s not going to cost you anything) is one of them!
A for sale by owner sign does not mean that the seller will not work with a Real Estate agent – it’s really best to have your own Agent, who can help advise you and help you research all of the market conditions.
For instance, most consumers we meet don’t know how to find out if an addition done by the Seller was permitted – and what impact that might have on the value of the home! A licensed Realtor has access to conditions that could impact the future value of your home.
4. Big Mistakes Home Buyers Make: Not Reviewing the HOA’s “Health”
Not Reading the Homeowner Association Documents: If you are interested in buying a home that has a Homeowner’s Association, there’s likely a laundry list of things you can and cannot do at your house. For instance, some Association Covenants restrict the number of cars you can have parked permanently – or weather or not you can park your boat in your driveway.
Sometimes, there are Association fees that cover the roof and grounds for a Condominium project or a Townhome Community. In that situation, you also want to read the Budget, and you will want to know if the project is currently approved for FHA or government financing – because again, this could affect future value of the property when you go to sell it.
Many Homeowner Associations were negatively affected by folks who could not pay their dues, and are in a deficit situation. This could mean that you would have higher dues in the future, so seeing what the Association’s Budget and Reserve Funds looks like, is one of the things we recommend as you look through the HOA Docs. You also want to be certain that they are not involved in any pending lawsuits.
Again, a professional Real Estate Agent should be able to help you navigate through many of these details that can, otherwise, be overwhelming as you are preparing to buy a home!
5. Big Mistakes Home Buyers Make: Forgetting About Google
Sellers Often Google Buyers: We know of a situation in North Carolina where a first time home buyer went on Twitter as she walked through a home and sent out “Just Found MY Dream Home! I would definitely offer MORE!”
When she made the offer to purchase, and the Seller saw the remarks… what do you think happened to her below asking offer???
Don’t let your feelings get in the way of negotiations. Be sure you keep your counsel “close” until you get all the way through the process!
If you are looking for a home in North Carolina, and you want to know more about Big Mistakes Home Buyers Make in North Carolina, call Steve and Eleanor Thorne 919 649 5058 we love working with First Time Home Buyers in NC – we’ll help you through this exciting time!