House-hunting can be incredibly exciting, especially for families, couples, and individuals looking to become first-time homeowners. Before getting too excited, potential buyers should know that the process of finding the right property isn’t all fun and games. There are some serious pitfalls to avoid when buying a residential property. Read on to find out about four of the most common of them.
1. Not Reviewing the Contract Conditions
Purchase agreements contain all of the details surrounding a sale. They’re legally binding contracts, so it’s always wise to get help by contacting Kelly Legal Group before signing on the dotted line. The contract conditions may not be as amenable as buyers would assume at first glance, so failing to review the contract thoroughly can lead to serious expenses.
To protect themselves, buyers usually include contingency clauses. These often include home inspection contingencies, fixture and appliance contingencies, and financing contingencies. The idea here is that if something comes up with the house, such as the inability to get adequate financing or the discovery of significant flaws during the home inspection, the buyer can walk away without losing his or her earnest money. Every buyer should have a lawyer review contingency clauses to ensure that the contract protects his or her rights.
2. Failing to Hire the Right Home Inspectors
Not all home inspections are comprehensive enough to identify all potential problems that could fall under the inspection contingency clauses in even a well-written purchase agreement. Many buyers assume that it’s enough to schedule an inspection with the professional of the seller’s choice and call it a day. In fact, buyers are entitled to have whatever qualified inspectors they want look at the house.
Sometimes, generalist inspectors fail to notice seemingly minor details like roof leaks and termite damage. They should hire specialists to identify potentially costly but hard-to-detect issues. Prospective buyers can request home inspections from specialists if they believe something could be seriously wrong with the house even if a more generalist inspector misses it. If the repairs will be too costly, they can request a price reduction or back out on the deal without facing adverse effects.
3. Starting Negotiations Before Getting Mortgage Pre-Approval
The mortgage pre-approval process evaluates potential buyers’ credit scores and histories, income, and mortgage amount to ensure that the lender will be willing to finance a purchase. Prospective buyers who assume they’ll be able to obtain financing may find themselves in the lurch during negotiations if they are not able to meet their lenders’ criteria.
It’s better to seek mortgage pre-approval first before beginning negotiations. That way, there will be no question as to the buyer’s ability to meet the stipulations of the purchase agreement’s financing contingencies. Having a mortgage pre-approval letter can also give buyers a leg up in competitive housing markets.
4. Fixating on Aesthetics
Everyone wants a house that feels like a home, but it’s a mistake to fixate on aesthetics during initial walk-throughs and home inspections. Fixating on small details like dated or unattractive wallpaper can cause potential buyers to miss out on ideal properties. Similarly, falling in love with a newly remodeled kitchen but ignoring serious structural concerns like poor drainage or roof leaks will cost buyers a fortune.
The Bottom Line
Buying a home should be exciting, not stressful. Take the time to investigate options, speak with industry experts, and learn from others’ mistakes to avoid turning the hunt for a dream house into a nightmare.