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Once you’ve saved enough cash for a downpayment, and found your perfect home on the market (and it’s within your budget!) you may think it’s a done deal. But here are some unexpected snags that may occur during the offer-making or negotiation process, which often take unprepared buyers by surprise. Knowing about these points in advance will help you prepare yourself for the possibility of their occurrence. Remember, knowledge makes for a smooth and stress-free real estate acquisition!
Even if the home you’ve found is comfortable under your budget, unnoticed overdue fines can bring down your credit score and could jeopordize your plans to finance your home in the last hour. How do you prepare for this?
Request a copy of your credit report every 6 months to a year, just to keep an eye on your credit score and make sure there aren’t any red flags in your activity. No matter how diligent you are about paying your bills on time slips-ups can always occur and go unnoticed, not to mention mistakes made by the credit bureau, or credit and identity fraud.
There are several other upfront costs to purchasing a home, other than the downpayment. Under-budgeting is a common reason for plans falling through last minute. Read more about the closing costs you’ll have to anticipate here.
Similarly, buyers may also underestimate their monthly mortgage costs. Have you taken into consideration interest, taxes and bills?
Use our mortgage calculator to estimate the additional monthly costs any purchase would carry.
Amenities are great, but don’t forget to factor them into your costs. For example, swimming pools may seem appealing at first impression, but they come along with higher condo association fees, or more of your time for maintenance in the case of single family homes. To prevent this mishap from occuring, inform yourself with your agent about the condo fees before visiting (and potentially falling in love with) a home.
Secondly, don’t automatically assume that amenities are included in the deal. Details such as whether light fixtures, curtains and appliances will be left in the home are usually specified later on in the sellers declaration. Finding out later on that they aren’t could be a deal breaker for some buyers, so make sure you discuss these points with your broker or the listing broker before you set any expectations.
Lastly, many a buyer turn their backs to a great home because of an issue that really shouldn’t be one. A jarring wall paint colour can throw off the aesthetic appeal of a room, but to make a smart purchase decision buyers should be prepared to look past small issues that can easily and cheaply be changed. The same goes for judging a home by its furniture. If the seller has awful taste, don’t let that fool you! You can always redecorate and customize the space later according to your own tastes. Judge a space on layout, brightness and size, not on superficial aesthetics.