Mammoth Misconceptions When Buying a Home
Common Misconception of Home Buying #1:
Buying a home is the smartest financial decision you will ever make. Thinking you can’t afford to buy is one of the common misconceptions of home buying. In fact, most American and Canadian home owners would be financially broke at retirement if it weren’t for one saving grace — the equity in their homes. Furthermore, mortgage rates are more flexible today than ever and tax allowances favor home ownership.
Real estate values have always risen steadily. Of course, there are peaks and valleys, but the long-term trend is a consistent increase. This means that every month when you make a mortgage payment, the amount you owe on the home goes down and the value typically increases. This owe less / worth more situation is called equity build-up and is the reason you can’t afford not to buy.
Even if you have little money for a down payment or credit problems, chances are that you can still buy that new home. It just comes down to knowing the right strategies, and working with the right people.
Misconception #2: Not hiring a buyer’s agent
Buying property is a complex and stressful task, and real estate transactions have become increasingly complicated. New technology, laws, and procedures, as well as competition from other buyers require buyer agents to perform at an ever-increasing level of professionalism. For many home buyers, the process turns into a terrible, stressful ordeal. In addition, making the wrong decisions can end up costing you thousands of dollars. It does not have to be this way!
Work with a buyer’s agent who has a keen understanding of the real estate business and who is on your side. Buyer’s agents have a fiduciary duty to you. That means they are loyal to only you and are obligated to look out for your best interests. Buyer’s agents can help you find the best home, the best lender, and the best inspector. Best of all, in most cases, the buyer’s agent is paid out of the seller’s commission, even though he or she works for you. This is not the time to “do it yourself.”
Misconception #3: Getting a cheap inspection
Buying a home is likely the most expensive purchase you will ever make. The cost of hiring a certified home inspection is very small – almost insignificant – relative to the value of the home being inspected. As a home buyer, you have recently been crunching the numbers, negotiating offers, adding up closing costs, shopping for mortgages and trying to get the best deals. Do not stop now. This is no time to shop for a cheap inspection. Do not let your real estate agent, a less-than-qualified inspector, or anyone else talk you into skimping here.
Certified inspectors perform the best inspections by far. Certified inspectors earn their fees many times over. They do more, they deserve more, and, yes, they generally charge a little more. Your new home is an investment, and you should think of a professional inspection in the same way. Do yourself a favor and pay a little more for the quality inspection you deserve.