Buying a house is one of the most important decisions of your life. A lot of thought and planning must be done in order to make sure that you are getting exactly what you want from your mortgage and your home purchase; however, it is easy to make common mistakes while completing the mortgage process. The following is a few mortgage mistakes that might be very costly.
Falling In Love with a House
Many people, when housing shopping, find one property that they feel attached to. They feel that they can’t live without this house only after viewing a few properties. They will overextend themselves and usually pay a higher price then the house is actually worth. Realtors are trained to try and push home buyers into buying the most expensive house as quickly as possible. If the Realtor does not have to give the client time to do all the usually inspections, then they won’t. Many time a Realtor will suggest to the home buyer to confirm the offer to purchase a day or two after the offer. This does not give the home buyer anytime at all to hire an appraiser or an inspector to make sure the house is what the seller is offering.
Remember, brokers and a Realtor is not your friend, they are in the business to make money for them self, and no matter how nice they may seem, there one goal is to make the most money as possible off of you. Don’t let a Realtor push you around in the home buying process, and it is usually better to let the house go, then to settle for a bad deal because it is something you really like.
In this time of template housing, it is very likely you will be able to find the same house if not something better, so do not become attached until seeing many houses. Who knows, the next house you see may be your even better than the last one.
Not Using First-Time Home Buyers’ Plans
There are a ton of government grants, loans, and other bonuses for first-time homebuyers; however, most people, in the excitement of buying their first house, forget that these options are even available. Most will get caught up with a realtor that is trying to sell them the first house that they see, that they will forget all about benefits available that could litterally save them thousands of dollars in home purchasing fees. A lot of governments have local plans to give the buyer their down payment as long as they meet certain criteria.
Before even contacting a realtor, you may want to spend a great deal of time on the internet browsing through mortgage and mortgage related resources to learn as much knowledge about the process before hand. The only person that is truly looking out for your own well being throughout the entire process is yourself and Top Home Mortgage Loans, so make sure you do yourself a favour and educate yourself before beginning the process.
Forgetting About Closing Costs
When getting ready to take out a mortgage, the majority of people only plan for the actual down payment on the mortgage itself. It is easy to forget about all the necessary closing costs that are required in home ownership. These should not be forgotten because they can easily add up to be almost as big as the down payment itself. The following is just some of the closing costs you must consider:
- Appraisal Fees ($100-$250)
- Inspections Fees ($300 and up)
- Property Insurance Fees ($250 and up)
- Applicable Sales Tax (Dependent on the size of the mortgage)
- Title Insurance Fee (Approximately $250)
- Land Survey ($600-$900)
- Legal Fees and Disbursement Fees (Dependent on your lawyer)
- Land Transfer Tax (A certain percentage of the property value)
- Home Warranty (Approximately $600)
- Other Government Taxes
- Mortgage Insurance and Application Fees
- Moving Expenses
- Renovations and Furnishing Expenses
- Miscellaneous Expenses
Just looking at this long list of possible expenses, it is always a wise idea to maintain a good amount of savings just in case it is required in order to close the property. Make sure you are not left without any available cash to make your first mortgage payments as well.
Before purchasing a new home, you should always make sure you do your research before beginning the search. Also, confirm that you have taken advantage of every possible program available. Do not let anyone bully you during the mortgage process and make sure not to buy the first house that you see and see multiple listings before deciding. Also, make sure that you have the funds available to complete the transaction without getting over your head, that includes closing costs.
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#1 by uk surveyors on January 20, 2010 - 1:28 pm
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