As a homebuyer, you may be excited about your new home. However, until the closing is final, you still have a lot that you need to worry about. Many homebuyers make mistakes prior to closing that can delay the sale.
When you decide to buy a property, there is a significant amount of planning and research that must go into the sales process in order to make it successful. Working with a real estate agent can take away much of the stress. However, it is ultimately up to you as a buyer to make sure that everything goes smoothly. Due to lack of experience or oversight, many homebuyers make crucial mistakes.
Buying a home involves a myriad of things that need to be done. In addition to ensuring that the right paperwork is signed, you also need to make sure that you are getting the best value for your offer and that you haven’t overpaid.
This is why planning is so important as an essential step in the home buying process. By doing your homework you can become aware in advance of the potential pitfalls of buying a home so that you don’t make the same errors as you go through the process.
Certainly, most errors are avoidable with the right information. Here are a few tips on how to avoid making mistakes before closing.
Errors in Paperwork
While errors in documents can be as simple as a misspelled name or incorrect contact information, more serious problems, such as incorrect numbers on loan agreements can cause a delay. Therefore, it is extremely important that you look over each document carefully as it is submitted for processing. Even the smallest errors in the documentation of your real estate transaction could delay the process by days or hours, because it all needs to be complete and ready before the closing.
If you want to avoid errors on paperwork, try asking for each document that you will be asked to sign in advance. By asking for documents early, you will have the opportunity to look them over and get assistance with any of the parts that you do not understand from your real estate agent or attorney.
If anything seems off or incorrect, bring it to the attention of your Realtor right away. You should also make sure that you obtain copies of all of the submitted documents so that you can ensure that the paperwork is error-free.
Not Checking the Title
There is always a risk there can be an unknown problem with the title for the home. Don’t wait until closing to find this out. If it is discovered that the are legal issues surrounding the sale of the home, such as a lawsuit or lien on the property, the sale will be delayed. Find out about these issues as early on as possible so that you can work with your real estate agent to resolve the problems before you are ready to close.
Getting a Cheap Inspection
A home inspection is one of the first tasks that you should probably take care of before you decide to make a serious offer on a home. However, many homebuyers make the mistake of trying to save money by hiring a cheap inspector. The cost of a home inspection is very low in comparison to the value that it provides. As a part of your strategy for determining if you have enough money to afford the home, you must make sure that your calculations were based on an accurate inspection for your home.
If you opted for a cheap inspection, it is probably a good idea to have a new inspection done by a reputable company before you make a final decision. A reputable home inspection service won’t offer the cheapest rates. However, you can rest assured that they will find all of the major defects in a home that should be known to you before you buy the home.
Not Paying Attention to Closing Costs
Closing costs are a mandatory feature of every mortgage loan that is issued. Many homebuyers make the mistake of not paying attention to these costs until the end of the process. As a result, these costs either end up being higher than they anticipated or are more than what they should have paid.
To avoid this, as a homebuyer, you should thoroughly review both the mortgage lender closing costs and third-party closing costs. Mortgage closing costs typically include:
- fees for preparing documents
- mortgage origination fees
- underwriting fees
Third-party service closing costs may include:
- costs for the appraisal
- credit report costs
- fees for tax services
- title insurance
“Lenders often give their fees unique names which can make it difficult to compare specific loan costs between banks.” says Dan Green of themortgagereports.com. “This is why it’s better to compare total lender costs rather than any one specific line-item.”
There are things that you can do as a homebuyer to make sure that the closing costs that you pay are not higher than they need to be. The most important step is to make sure that you pick the right loans for your unique situation. A lending agent can guide you through the options that are available. You should then review the various options and make sure that you pay the appropriate number of discount points. Your closing agent can guide you through this process.