Looking for a new home can be a fun and exciting experience, but it’s also easy to make mistakes that can really hurt your home search. Make sure that you’re being the best homebuyer possible by avoiding these common missteps.
1. Searching for a home before getting preapproved by a lender. Getting preapproved should be the first step of your home search. During the preapproval process, a lender will let you know exactly how much you can afford to spend on a home. Don’t wait until you find a home that you love, only to discover that it’s way out of your price range. Having a preapproval letter ready also shows sellers that you’re a serious buyer, so make getting preapproved a priority.
2. Not having a clear and defined idea of the type of home you’re looking for. It’s understandable that you want to keep your options open so that you don’t miss out on any homes, but it’s easier to search if you have an idea of what you’re looking for. Before you go out and look, sit down and write a list of desirable home traits. How many bedrooms do you want? How many bathrooms? Do you need a backyard? Does that backyard need to be fenced? What area are you interested in living in? Are there any areas that are too far away from your job to live? Having those starting points will help narrow down your search and make it easier for you to find a home that will fit your lifestyle.
3. Using Zillow to search for homes. When you find a real estate agent, they should set up a search on their multiple listing service (MLS) for you that will show you up-to-date information about homes for sale that fit your criteria. Zillow is an aggregate site, which means it takes information from various MLS sites and compiles them. The problem with that is that since the information isn’t directly monitored by the agents who have the homes for sale, the information is often incorrect or the site doesn’t update quickly to show you that the home you’re interested in actually closed several weeks ago. (I wrote a post about this issue a few months ago.) Save time, and use the MLS site that your agent provides you with.
4. Being slow to respond or make an offer. Today’s market is spectacular, which is great for sellers, but it makes it imperative that you see homes quickly and make offers right away if you’re interested in a property. If you find a home that you love, chances are that someone else loves that home too, and the longer you wait to see it or write an offer, the more time you give that other person to sweep in and buy it first. Inventory is low, meaning that there aren’t a lot of homes available and the good ones go quickly.
5. Not having a plan for what you’re going to do with your current home. Home sale contingencies are becoming less and less popular with sellers. People don’t want to accept an offer if that means they have to wait for you to sell your home, and they definitely won’t accept it if your home isn’t even on the market. If you know that you need to sell your home first, get it in the best possible condition and put it on the market. The timing can be tricky, but ask your real estate agent what they think you should do before you even start looking at other homes.
6. Spending a lot of money during the home buying process. I can’t stress this point enough. Your credit will be pulled when you get preapproved and the amount you can afford to spend on a home will be determined using your debt-to-income ratio. If you get preapproved and then rack up several thousand dollars in debt, that will affect that ratio, which will affect how much the lender is willing to give you. The lender will pull your credit again right before closing, and if that ratio is different than what it originally was, your closing will be delayed.
Help ensure that your home buying process goes smoothly by avoiding these common mistakes. If you have any questions during the home buying process, be sure to ask your real estate agent for advice. They are experts and will let you know if you’re doing anything to hurt your chances. Good luck!