The 12 Most Common Mistakes New Home Buyers Make
and How to Avoid Them
"Its much easier to cross a mine field when you know where the mines are. By knowing the common mistakes that most
people make when buying a home you can save yourself time, money and a great deal of frustration."
Thank you for responding to my recent notice, offering this valuable Report: "The 12 Most Common Mistakes New Home
Buyers Make and How to Avoid Them." My name is Tom Cosentino, and I am a Residential Mortgage Specialist.
For most people buying a home is the largest investment they will ever make. Unfortunately many homebuyers go into
the process without learning about the process. This often leads to the purchase being more expensive and more
difficult than it needs to be. By learning from other peoples experience you can avoid.
- paying too much for the home you want, or
- losing the opportunity to own your dream home or,
- buying a home with lots of problems or,
- (worse) buying the wrong home .
A systematic approach to the home-buying process can help you steer clear of these common mistakes, allowing you to
not only cut costs and save time, but also make the process a more pleasant experience.
This important report was created for people who are considering the purchase of a home and want to protect
themselves and their families from unnecessary problems and expense. It is based on more than 17 years of experience
in the real estate and mortgage financing industry helping thousands of people just like you realize their dream of happy
home ownership.
I believe the best way to help people get what they want is to educate them so that they can make decisions based on
correct information. I want the people I deal with to be well informed (knowing both the good and the bad) and I welcome
questions. If you are dealing with an agent or loan officer that is not willing to answer your questions openly and
honestly I encourage you to seek out someone that will.
12 Home Buyer Mistakes
This important report discusses the 12 most common and costly homebuyer mistakes and what you can do to avoid
them:
1. Not Checking Out Each Area Thoroughly
If you are planning on buying a house in an area that you have lived in for a long time this may not be an issue. But if
you are new to the area it will be well worth your while to ask people you trust about the different areas you are
interested in. When you narrow it down to two or three choices, walk the neighborhoods, talk with people you meet, visit
community organizations, schools, places of worship, etc. and make sure this is area you will be comfortable in.
2. Not Verifying Values
What price should you offer when you make an offer on a home? Is the seller asking too much or is this a bargain you
should jump on? You will never know for sure until you research the market and look at what comparable homes have
recently sold for in that particular neighborhood. This is something your real estate agent can help with.
By accessing the local multiple listing service an agent can provide a list of all the homes that have sold in a prescribed
area. Ask your agent to provide a list of all the homes that have sold within the last three to six months that are the same
type of home that you are interested in and close to the same size and age (or at least condition) along with the final
selling price of the property (including any known seller concessions).
If you will take the time to drive by these properties you will quickly get a feel for values in the area and be better
equipped to make a reasonable offer for the property. If you dont have a real estate agent we would be happy to refer
you to one.
3. Not Getting Pre-Approved For a Loan First
This is where most people get the cart before the horse. They get excited about buying a home and start looking
around. Before you know it they have hooked up with a real estate agent and are seriously considering different
properties. Then they finally ask the question: Can we afford this? Unfortunately the answer is often no and they have to
start all over again. And, of course, when they start looking at lower priced homes their enthusiasm is dampened
because they had their hearts set on the nicer homes.
Getting pre-approval not only helps you know what you can afford but it puts you in a stronger negotiating position as
well. When the seller and their agent know that your loan is done and just waiting for you to find a property they will be
much more interested in your offer and will give your offer more weight against competing offers.
Getting pre-approved is fast, easy and normally free. Most mortgage professionals can obtain written pre-approval for
you at no cost and no obligation, and it can all be done quite easily over-the-phone. More than just a verbal approval
from your lending institution, a written pre-approval is as good as money in the bank. It entails a completed credit
application, and a certificate from the lender which guarantees you a mortgage up to a specific level when you find the
home youre looking for.
Make sure you are dealing with a professional who specializes in residential mortgages. The mortgage industry is
extremely complicated with literally hundreds of options and choices. Using an expert can make the difference between
getting into the home of your choice or having to rent forever.
4. Taking Your Credit For Granted
Unfortunately you may be reading this report too late to have kept from making this mistake but it is never too late to
start improving your credit rating. In the last few years the way lending decisions are made has become much more
automated. And the way the decisions are made has changed dramatically. For the most part decisions are made based
on certain guidelines and not left up to subjective humans.
This places more and more importance on your credit rating when applying for a loan. How good your credit rating or
"scores" are depends on several factors such as: Current credit balances, Amount of current available credit, Late
payments (How many, How late, How recent, Type of Account) and recent inquiries about your credit.
If you are planning on getting a mortgage loan make sure you are making all of your current payments on time and
avoid any unnecessary inquiries into your credit. In other words, dont go out shopping for a car or new furniture and
have sales people all over town running credit checks on you. If you want to have the highest scores possible and
therefore qualify for the best rates available it is best to be patient and wait until your loan is done before you go do
things that will affect your scores.
5. Not Having a Prioritized List of What Is Important
Many new home buyers will often get swept up in the excitement of becoming homeowners then after its too late they
find out that the home they just purchased does not suit their needs. Before even beginning the process clearly define
your wants and needs. Put the list in writing and prioritize it in order of importance. Measure each property you look at to
determine how well it matches your list.
Here is a list of some items to take into consideration:
Size of home: Number of Bedrooms, Baths, Etc.
Style: Are stairs or a basement ok? Etc.
Type: Single Family, Duplex, Condo, PUD
Condition: Does is have to be near perfect or are you willing to do some repairs in order to get a better price?
Location: Type of neighborhood, Proximity to work, schools, etc.
Special Features: Garage, Wheelchair access, Air Conditioning, Etc.
6. Not Checking on Title and Boundary Issues
Its no fun to get to closing and find out that there is a problem with the Title to the property. These problems could
appear in the form of undisclosed owners, tax liens, mechanics liens, easements, leases or other encumbrances. One of
the first things that should be done as soon as you come to an agreement on the purchase of a property is to order a
preliminary title report from a title company. Your real estate will normally handle this. Make sure you receive a copy and
review it.
If there are any parts of the report that you dont understand, ask your agent or an employee of the title company to
explain. If there are issues that need to be taken care of make sure that they are completed before closing and that the
Title Company is issuing you a clean policy of Title Insurance. This Title Insurance Policy will help protect you from
claims that may come along after the fact.
Its even worse when you find out about a problem after closing such as a problem with your property boundaries. For
instance, if your neighbor discovers that the shed at the back of your property is sitting partially on their property its
your problem regardless of whether the shed was built there by you or a previous owner. Surveys help you avoid these
types of problems.
The dependence on surveys varies from area to area depending on how established the neighborhoods and boundary
lines are and the type of legal descriptions that are used. Your agent can give you a good idea of the necessity of a
survey or an update of a previous survey. However, if there is any question as to the boundary lines of a property your
offer should be made subject to your approval of a survey by a licensed company.
7. Not Getting a Thorough Inspection
Another valuable tool for avoiding unexpected problems is a professional inspection done by a licensed home inspection
company. Your offer should also be subject to your approval of just such an inspection. A professional inspector will
objectively inspect the home inside and out and should be able to give you a report of any item that needs to be fixed
with associated, approximate cost.
No home (even a fairly new home) is perfect. You should not be alarmed when the inspector suggests minor repairs or
maintenance issues. This is quite normal. Avoiding the large repairs or expenses (such as termites, radon, mold, lead
paint or asbestos) is when the inspection will more than pay for itself.
8. Not Negotiating Hard Enough on Price
Obviously your ability to negotiate the best price on a property will vary depending on your current markets conditions. A
buyers market means that there is more supply than demand and therefore buyers have the upper hand. A sellers
market is just the reverse.
Regardless of the market, however, you can usually negotiate a better price if you will follow the steps previously stated.
These steps will give you the information and positioning necessary to approach the negotiation process fully prepared.
You should also be careful when offering a certain price and terms for the property not to give any indication that you
will go higher. This is the time when a poker face is extremely useful and keeping your excitement in check is critical.
Just remember that every dollar you save on price will save you 2 to 3 times that amount in mortgage payments.
9. Not Negotiating For Extras
This is another opportunity that is often lost during the negotiation process. That is the opportunity to save money on
items you will need to buy if you dont have them (such as a refrigerator, lawn mower, etc.) or to get goodies you would
not normally buy (such as a hot tub or sauna). Many of these items can be had simply for the asking. Many home sellers
dont want to take the time and effort to have to move the larger items and often they are looking for an excuse to buy
something new. Whether they are or not, it cant hurt to ask. These types of items make good bargaining chips and the
worst they can do is say no.
10. Not Following Up On Contract Stipulations
When negotiating the purchase of a property there will often be items (such as repairs, etc.) that the seller agrees to
take care of prior to closing. It is a mistake to simply assume these have been taken care of and not check on them prior
to closing.
Make sure to do a final walk-through of the property well before the closing date. Bring along a list of all the items that
were agreed to and check them off as you go. Its not a bad idea during the negotiation process to agree to an amount
to be held in escrow at closing if the items are not taken care of. This will give the Seller motivation to make sure they
are completed and will avoid delays in closing if they are not.
11. Hidden Expenses
Its no fun to get to the closing table and find out that the costs of completing the transaction are higher then you
thought. If inspectors, surveyors, etc. have agreed to be paid at closing make sure you know what their charges will be
and get it in writing.
The same is true of your lender. Your lender should be able to provide a detailed estimate in writing of all expenses to
expect in originating your new loan. Be sure and bring these items to closing and compare them. No lender can be exact
down to the penny in estimating these costs but a good lender should be pretty close.
12. Rushing The Closing or The Escrow Period
Nobody likes surprises when it comes time to close. Moving is one of the most stressful times in peoples lives so both
the Seller and you as the Buyer are going to be more emotionally "uptight" then normal.
The best way to minimize the stress is to expect some bumps along the way and give yourself time to deal with these
challenges as they appear. Make sure to set reasonable time frames for items to be accomplished then hold to your
schedule as much as possible.
Ask your lender to have all the documents available for review a day prior to closing. Check them out carefully to make
sure the costs on the settlement statement are in line with what you expected and that the terms of the loan (i.e. interest
rate, fixed or variable, term, pre-payment penalties, etc.) are what you agreed to. This way if you do find a discrepancy
you will be able to deal with it without feeling under the gun and there will be time to fix it before it becomes a problem.
I hope you have enjoyed this special report. We currently have over 40 creative loan programs to fit your needs. Please
contact us at
412-489-4903
to set up your FREE No-Obligation consultation where we will meet to tailor a program to fit your needs and comfort
levels for monthly payment and investment.
Sincerely,
Tom Cosentino
Union National Mortgage Co.
412-489-4903
P.S. If you would like to get started now please click the following link or image below to fill out a Free No-Obligation
Secure Online Application and we will contact you to schedule a free consultation to help you get the home of your
dreams with the best terms available...regardless of your credit!
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