Australian Property Updates

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7 Most Costly Mistakes Made By Home Buyers

Mistake 1 – Not getting pre-qualified for a loan before you search for a home.
Getting pre-qualified for a loan by a professional lender will let you know in advance how much mortgage you can afford. This allows you to make an offer on your home with confidence funding is available.

Mistake 2  – Not being honest with your agent or lender up front about your credit.
Your credit– whether good, bad, or limited–affects everything from your down payment to interest rates. The estate agent or a professional mortgage consultant can often advise you as to how you can get credit problems cleared up or completely eliminated from your credit report before you apply for financing or make an offer on your home.

Mistake 3 – Not taking out insurance on the property once the contract is signed.
All buyers need to ensure that they have an insurance policy which protects their interest in the purchased property from the day the purchase contract is signed. We have heared many horror stories of buyers being forced to settle on the purchase of a property which had burned down during the settlement period. There is a risk that the seller’s insurance cover expires before the buyer takes out a policy and the property remains uninsured.

Mistake 4 – Not requesting a market analysis of the home, in comparison to similar homes in the neighbourhood from your agent before you make an offer.
A home is not just a place to live—it’s an investment in your future. View several homes before you make an offer so you know what’s available on the market. Be certain you’re making a wise investment by asking your agent to provide recent comparable sales of similar homes in the same neighborhood.

Mistake 5 – Not inspecting a home before you buy it. Hire a professional to inspect every aspect of the home thoroughly.
This can save you thousands of dollars in costly repairs and hundreds of headaches in the future. A thorough home inspection can also allow you to negotiate for any repairs prior to signing the purchase contract.

Mistake 6 – Not working with a Professional Buyer’s Agent. The agent you are working with does not necessarily work for you.
Unless your agent is working as your buyer representative, they are working for the seller. Although using a Buyer’s Agent to purchase a home usually attracts a fee. It is a great service for people who are too busy to do the leg-work themselves or simply for those who are not experienced at real-estate negotiations. Often buyers find that by using the services of a good Buyer’s Advocate, they are able to save more on the purchase price than the costs of this service.

Mistake 7 – Not taking into account your present homeowner or renter status.
If you already own a home and must sell this home before you buy a new one, it’s best to get an agent to do a complete market analysis on your present home. This allows you to know how much you can sell your current home for, before you make an offer on a new one. If you are leasing or renting, the lease’s expiration date will give you a timetable for your new purchase.