Buying a home is one of the most exciting and stressful things you can do. There are so many steps and so much information to keep track of, it's easy for something to go wrong. In this blog post, we will talk about 5 ways in which buying a home can go wrong!
Missing a closing date:
The most common way in which buyers can miss their close of a home is by missing the deadline for submitting all of the necessary paperwork or delayed underwriting. It is important that you work with a loan officer who has experience as a missed closing date can put you in breach of contract.
You Find Something Wrong In The Inspection:
It is important to hire a reputable inspector. If you find something wrong in the inspection, it will be your best interest to negotiate with the seller for a price reduction. If the damage is significant such as foundations or severe mold, you can walk away from the deal. This is not ideal because you were already in contract on the home and many states have deterrents for that such as due diligence fees.
You Get A Mortgage Higher Than Your Comfortable Payment:
The last thing you want to do is lose the home you just worked to get. Getting a payment that you think will work but is too high is what happens when you rush through the pre-approval process. Just because you are approved for a certain loan amount does not mean you should go that high. Look at your budget and preferences before you move forward.
You Get Into Contract Before Getting Pre-Approved:
This is a big mistake that many people make. You want to have the peace of mind knowing your loan has been approved so that way you know there will not be any surprises that stop you from being able to fulfill your end of the buying contract. Make sure to get a pre-approval letter before starting your home search.
The Appraisal Comes Back Low:
When you purchase a home, an appraiser will come in and assess the property. The lender will loan you the appraised amount or the sales contract amount (whichever is lowest). If your appraised amount is lower than what you negotiated with the seller, you as the borrower/buyer must cover the difference at the closing table. This is common in seller's markets.
If you already are struggling to meet your cash to close, this can cause the entire deal to fall apart. Make sure to meet with your lender prior to making any offers and discuss the process if the appraisal comes back low.
The process of buying a home can be stressful. There are many things that could go wrong, which is why it’s so important to consider all the details before you start looking for your next place. We included just 5 potential problems that may come up, but there may be others and it's key to work with an experienced professional. Have questions about financing or any other part of this process? Give us a call today!
