The Top Ten Mistakes that Buyers Make in Buying a Property

1. Not using a REALTORS®
A very big misconception when it comes to buying a home is that you will pay more if you use a REALTOR®.  The reality is that the REALTOR® fees (both buyers and sellers agents) are typically paid out of the sellers proceeds.  This means that it cost you nothing more to have a trained professional help negotiate on your behalf.

2. Not getting Pre-Approved BEFORE looking at properties
Going out and looking at homes if fun. But if you don’t know how much you can afford, you might fall in love with a home that you can’t qualify for; or even worse you can qualify for but the payment ends up making you “House Poor”.

3. Make a new substantial purchase (car, truck, new furniture, big vacation) right before or during the process of buying a home
If you are really serious about buying a home, you need to put other big purchases on hold.  These big purchases could easily prevent you from buying the home you really want, by increasing your debt to income ratio too much.

4. Ignore past credit issues rather than correcting/repairing them
It would be nice if inaccuracies or other credit problems would just go away if you ignored them but they don’t.  Today’s lending market is getting tougher and tougher to get a mortgage.  Old delinquent accounts on your credit report (even if it is wrong) can prevent you from buying the home now.

5. Jump from one Mortgage Broker to the next
In the beginning, you need to decide what Mortgage Broker you want to work with.  Jumping around will only complicate the process.  Find a Mortgage Broker that you can trust will deliver on their promises and charges a fair price and work with them.

6. Listen to friends/neighbors/family advice rather than trusting their professionals
REALTORS® and Mortgage Brokers must go through hours and hours of education and licensing requirement to hold those titles.  If the professionals you have chosen to work with are giving you advice, it is probably a good idea to listen to them.  The people who earn their living in the Real Estate Industry are much more qualified to give you advice than most friends and family members.

7. Expecting REALTORS® or Mortgage Broker to cut their fees or Trying to Start a Bidding War between REALTORS® or Mortgage Brokers
There are some things in this world that you can benefit from by getting two service providers in a bidding war, BUT BUYING A HOME IS NOT ONE OF THEM!  The most skilled and experienced professional in the Real Estate Industry refuse to compete on price.  Instead, these professional compete on quality of service.  Remember, you always get what you pay for.

8. Not being fully honest (full disclosure) with your Mortgage Broker about past financial problems
If you have had a financial problem in your past, your Mortgage Broker needs to know about it up front.  Many problems in qualifying for a mortgage can be eliminated or worked around if they are dealt with in the beginning.  Nothing will kill buying a new home faster than unexpected problems arising from lack of full disclosure.

9. Expecting to buy the best house for the cheapest price
Nothing is forever, you might have to buy and sell one or two properties before you get your dream home.  When buying a home, you need to be realistic about what you can comfortably afford.  If you are pushing the limits of what you can afford, what are you going to do when you hit a rough patch; and yes, you will hit a rough patch.

10. Not collecting and supplying requested documentation to your Mortgage Broker ASAP
Getting a mortgage now can be a lengthy process.  If you are not quick to get requested documents back to your Mortgage Broker, it will only make the process even longer.  Be prepared with the basics (2 years of full tax returns and w2s, 2 months of all bank statements, 30 days paystubs, explanation and documentation for special situations such as bankruptcy, foreclosure, credit inquiries), but also be ready to get updated or additional document as they come up.