Home Buying in Washington>Question Details

Trulia Washi…, Other/Just Looking in Charlotte, NC

Which problems do homebuyers make for themselves, and how should they be avoided?

Asked by Trulia Washington DC, Charlotte, NC Thu May 30, 2013

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6
#1 mistake made by home buyers = Not shopping for the best lending option

Regulations have been put into place to allow buyers to shop lenders prior to entering into a contractual obligation... Buyers rarely obtain more than 1 Good Faith Estimate, from 1 lender...

Can that be frustrating for the broker, and the lender? Absolutely... but in an industry so riddled with corruption as of late, it's time the power was placed back in the hands of the buyers.
2 votes Thank Flag Link Fri May 31, 2013
Probably a close #2 is not shopping for title services. My title company commissioned a closing costs study a couple years ago and found closing costs in the DC metro area varied by company as much as $1,200! Most homebuyers -- especially first-timers -- don't realize it's their right to shop around and choose their own title company to close the deal.

Homebuyers can get a better sense of what their entire cash to close will look like by using the free, one-of-a-kind app we created for iPhone & iPad, called Close It! (http://closeitapp.com) Works for the DC, VA and MD.

App Store link: https://itunes.apple.com/us/app/close-it!/id647917344
Flag Fri Jun 14, 2013
A common misperception among homebuyers is that in order to get a good deal on the purchase of a home, they must buy it for less than listing price. This strategy can lead homebuyers to make needlessly weak offers for otherwise desirable listings, all because of their misplaced focus on "getting a discount."

In reality, sellers and listing agents frequently list properties at prices substantially above or below what the market actually supports.

Discount shopping typically occurs because homebuyers are unsure of the home's true value. The only concrete number they see is the list price and therefore assume anything less would be a bargain.

The best way for homebuyers to avoid this problem is to put more work into independently valuing the property without the influence of its list price. What have similar homes sold for in the area? What are current market trends? How well does this property fit with the characteristics the homebuyer is looking for in a home?

Best of Luck,
Jonathan

NOTICE: The materials on this website are provided for informational purposes only and do not constitute legal advice.
0 votes Thank Flag Link Fri Jun 28, 2013
I think by not always listening to the loan officer and Realtor buyers create problems for ALL parties and in the end themselves. Loans have changed immensely in the last 5 years for the levels of documentation needed and stricter UW standards. I have clients that argue about what we need, want to change things etc. They are wasting valuable time we need to close their loans and protect their locks. Especially in a time like this when interest rates are rising steadily. Some of the items we are required to obtain are silly. It doesn't matter if we ask for them 99.9% of the time we do need them. Each lender is slightly different but for the most part the rules are dictated by Fannie Mae and Freddie Mac. There is no point in arguing common sense with them. Please get us what we need and do it as quickly as possible. If you aren’t sure what to do please just ask us.

Thanks,

Brent Mendelson
Senior Loan Officer
1ST Mariner Mortgage
O-240-235-5314
C-301-412-0259
F-240-235-8236
Bmendelson@1stMarinerbank.com
Lending in all
0 votes Thank Flag Link Fri May 31, 2013
I think one of the biggest problems is looking at homes out of their price range. They really need to know exactly what they can afford before they get in the car to look at homes. They also need to know what type of community that they want to live in. In Scottsdale most of the communities are golf related. If you don't want to live in a golf community, your options are more limited.
0 votes Thank Flag Link Thu May 30, 2013
What a great question! Knowing limits is really important but so is having trust in the professionals you are hiring to assist you. Obviously you have to do your homework too but your realtor and lender are there to guide and shepherd you through the process. Don't waste time on a property doing your own home inspection when you'll hire a home inspector later who can give you a true education. Trust your instincts. Everyone may say this is the hottest neighborhood going but if it doesn't appeal to you don't think you are wrong. The people you work with in buying a house are bound by confidentiality; don't complicate their jobs by holding your cards close to your vest and keeping important information secret. You are creating a team; you set the goal, the team members know their assignments and the goal line is a successful closing. Hope that makes sense.
0 votes Thank Flag Link Thu May 30, 2013
The biggest problem homeowners create for themselves is buying more house than they need and spending more money than is necessary. Buying a property is an investment and should be approached conservatively.

Tony Taylor, DC Real Estate Guy
202.520.1819
0 votes Thank Flag Link Thu May 30, 2013
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