TEN DEADLY MISTAKES
Buyers make when purchasing a home
Tips for making the selection process easier
When looking at several homes start each tour of a potential home with a picture of the address plaque so you can easily identify it later
Take notes during each home visit. Record any noteable features, architecture and design elements. List what changes you would make and
what details really stand out . You will especially want to write down your first impressions of each home.
Pay attention to the home’s surroundings. Generally, avoid the most upgraded home on the block. Is it a friendly nieghborhood? Will parking be an issue? Are there schools in the area?
Mistake #1
Choosing a real estate agent who is not committed to forming a strong business relationship with you.
HERE’S HOW TO AVOID IT
We are committed to making a professional connection with you and are dedicated to serving your needs before, during and after the sale
Mistake #2
Making an offer on a home without being pre-qualified
HERE’S HOW TO AVOID IT
Pre –qualification will make your life easier- take the time to talk with your bank or mortgage broker. Their specific questions with regards to income, debt and other factors will help you determine the price range that you can afford. It is one of the most important steps on the path to home ownership.
Getting pre-approved helps to avoid hiccups or obstacles before you begin the home shopping process. Being pre - approved helps in the following ways
1) determines a price range which will help you understand what your monthly costs
2) guarantees the rate from 90 to 120 - days
What does a Lender consider when looking at your mortgage application?
Income and Job stability - income determines how much you can borrow. In most cases it is 32% of your gross income. All other debts must not exceed an additional 8% of your gross income
Credit history - Your credit score must show that you pay your bills on time. If not you may still be approved but the interest rate may be higher
What the lender is going to need from you to get you qualified
1) Income confirmation in the form of a letter of employment and your most recent pay stub
2) Confirmation of a down payment and the source of it. Statements, RRSP statements, stocks etc. showing a 3 month history. If there is a large lump sum deposit you will likely be asked to explain where the deposit originated.
For mortgages where the down payment is less thatn 20% of the purchase price, you will be asked to demonstrate that you have access to 1.5% of the purchase price in your bank account. This can be shown by way of a line of credit, credit card, gift from family, savings etc, in case closing costs run higher thatn expected
Mistake #3
Not knowing the total costs involved.
HERE’S HOW TO AVOID IT
Early in the buying process ask your realtor and mortgage representative for an estimate of closing costs. Title insurance, lawyers fees, land transfer, hst tax etc
Mistake # 4
Limiting your search to open houses , ads or the internet.
HERE’S HOW TO AVOID IT
Many homes listed in magazines or on the web may have already sold. Your best course of action is to contact a realtor. We have up to date local market information that is not available to the public. We may even know of a property that is not listed for sale yet that may fit your needs giving you the inside scoop
Mistake #5
Not following through on due diligence
HERE’S HOW TO AVOID IT
Make a list fo any concerns you have relating to the property such as, schools, TARION warranty, neighbors, etc. This is likely the largest single purchase you will ever make so remember there are no dumb questions!
Mistake #6
Not having a home inspection
HERE’S HOW TO AVOID IT
Trying to save money today can end up costing you tomorrow. A qualifies home inspector can detect issues that many buyer can overlook. This is probably the best $300 - $400 you will ever spend. While in a competitive situation may not enable you to have an inspection done, it is highly recommended. Whenever possible, have an inspection done so that you're completely informed about your purchase.
Mistake #7
Not examining insurance issues
HERE’S HOW TO AVOID IT
Purchase adequate insurance. Advice from an insurance agent can provide you with answers to any questions you may have
Mistake #8
Not considering long term needs
HERE’S HOW TO AVOID IT
It is important to think ahead. Will this home suit your neds 3-5 years from now? How about 5-10 years?
Mistake #9
Thinking that there is only one perfect home out there
HERE’S HOW TO AVOID IT
Buying a home is a process of elimination, not selection. New properties arrive on the market daily, so be open to all possibilities. Ask your realtor for regular market updates and a comparative analysis for any property you are considering the purchase of. This compares similar homes that have recently sold or are for sale currently
Mistake # 10
Not considering the future re-sale of the property
HERE”S HOW TO AVOID IT
Keep in mind that someday you will be the seller of this property. Have you considered all the possible influences on the value of the property such as development in the area, relocation or upgrading of major roads, employment influences etc.
