Top Buyer Mistakes

Always put agreements in writing. Oral promises don’t hold up in contract disputes. If something is stated verbally, like the inclusion of an item (such as a washer and dryer), ensure it's written into the contract to avoid misunderstandings later on.

Pre-qualification gives you a general idea of how much you can afford, but pre-approval means a lender has reviewed your financial situation and committed to a loan amount. Being pre-approved puts you in a stronger position to make an offer and ensures you don’t miss out on the perfect home when it comes along.

Just because you’re approved to borrow more doesn’t mean you should. Take a close look at your monthly expenses—debt, utilities, groceries, entertainment, and savings—and ensure your mortgage fits comfortably within your budget. As a rule of thumb, your total monthly debt, including your mortgage, should not exceed 36% of your pre-tax income. Don't forget to budget for closing costs, moving expenses, and ongoing home maintenance.

While friends, family, or a local inspector may mean well, they may not have the expertise needed to guide you through the real estate process. This is a major financial transaction, so do your own research and lean on professionals with proven experience and a solid track record. Placing your trust in the right team can save you time, money, and headaches in the long run.

It’s easy to fall in love with a house, but make sure it fits your family’s needs and your budget. Create a list of your must-haves and desired features, and ensure the house meets those requirements. Take the time to explore the neighborhood at different times of day to check for noise or traffic patterns. Also, research the local schools, even if you don’t have children, as they can impact the home’s resale value.

Avoid purchasing a home that’s priced significantly higher than surrounding properties. Buying the most expensive home on the block could hurt your future resale value, as your neighbors’ lower home prices could impact yours. Additionally, if you're buying with plans to flip the home, keep in mind that market fluctuations could result in a sale price lower than what you owe.

It’s crucial to understand everything you're signing. Request documents in advance, read them carefully, and don't hesitate to ask questions. Make sure you have copies of your mortgage papers before closing so you're fully prepared for what’s ahead.

Buying a home is a complex process, and while you may choose not to work with an agent, it’s essential to build a strong team to support you—lender, inspector, insurance agent, and possibly a lawyer. Enlist these professionals early to help guide you through the process and ensure you make informed decisions.

Protect yourself with essential contingencies, such as financing, home inspection, and insurance. A lender’s appraisal may come in lower than the sales price, which could affect your loan. Always arrange for a thorough inspection to uncover any potential issues with the property. Additionally, ensure that you can secure adequate insurance, as some areas may have difficulty obtaining hazard coverage.

Don’t be tempted to purchase a home that’s significantly more expensive than others in the area. This could limit your home’s resale value and increase the risk of losing money if you need to sell in the future. Keep in mind that market conditions can change, and what may seem like a good investment today may not be as favorable tomorrow.