As the saying goes, “Hindsight is always 20/20”. If only you had known that your soon-to-be next-door neighbor was in a rock band that liked to practice…at all hours of the day. If only you had thought twice before agreeing to an escalator clause—and now you home is worth less! These are just a few of the many regrets that can hit home buyer who lacked the foresight to perform due diligence.
Here are some of the top regrets:
Repairs prior to close. Don’t be afraid to ask the seller to fix things that need repaired. It’s better to have as many things as possible taken care of prior to moving in, that way you can focus on more important things like settling in and enjoying your new home.
Not asking your agent for a rebate. As a general rule, most real estate agents feel they work hard to earn their commission, and don’t like the thought of giving a portion of it right back. But there are ways to structure a transaction so that everyone’s happy. If you’d like you agent to rebate you enough funds to pay for your closing costs then by all means ask. The worst he or she can say is no. But if you agent is willing to rebate a portion of his or her commission then you stand to save hundreds, possibly thousands of dollars, depending on the purchase price of the home and the rate of commission.
Failing to get to know an area before moving in. There no worse feeling than having taken possession of your new home, only to realize the neighborhood takes on the appearance of a crime scene waiting to happen at night. If you have any question at all as to the character of a neighborhood in which you are considering purchasing a home then be sure to scope it out at various times of day, including different days of the week. It might cost you some time and gas, but that sure beats being stuck with a mortgage on a home in an undesirable area.
Not putting down a bigger down payment. Mortgage insurance is the price you pay for not putting down at least 20 percent. What’s more, with programs like FHA, even if you manage to pay down your mortgage to less than 80 percent loan-to-value, you are still required to pay mortgage insurance until at least 5 years have passed. If you can comfortably afford to put down 20 percent then it is advisable to do so and avoid paying mortgage insurance.
Not having important things inspected. There’s no way of knowing whether you’re buying a home or a headache without having a home inspection. But a home inspection won’t reveal the existence of problems with the sewer line. If there is any doubt as to the integrity of the sewer line, especially for older properties, then strongly consider paying for an inspection.
Passing up the fixer-upper in the better neighborhood. Where your home is located can make a huge difference in your state of mind. Stepping outside your home every day to a nice neighborhood is comforting. Conversely, having to live in a less desirable area can adversely affect your quality of life. Buying a fixer-upper a nice neighborhood can be the smart way to go if you don’t mind stepping into a project. You can always fix up a home, but you can’t fix up a neighborhood. It’s far wiser to get the neighborhood right and work on the home than vice versa.
Not taking a test run of the daily commute. If you are unfamiliar with local traffic patterns then it pays to actually test -drive the route you’ll need to take on your daily commute. You might be surprised to discover that traffic can really get backed up at certain times of day.
Not considering the true cost of repairs. Buying a fixer-upper might sound appealing on paper. But dreaming and doing are quite often two very different things. What looks like a relatively minor repair could turn out to be far more time consuming and expensive than anticipated. For example, your plans to merge the den with the living room didn’t account for the load-bearing wall. Do yourself a favor and research things as much as possible before jumping into a project that might be better left for a more experienced do-it-yourselfer.
Not taking measurements. What happens when the stairway lacks sufficient clearance to allow passage of the king-sized bed you just paid $1,800 for? It’s far better to take ample measurements before investing in furniture or appliances that might not fit.
Not considering the future resale value of a home. That cozy 2-bedroom bungalow looked like an awesome investment. Only now you have to move and are finding out how limited the market really is for 2-bedroom homes. Getting what you want and what is best for you are not always the same thing. When buying a new home, the future resale value must be considered. Instead of buying a 2-bedroom, get a 3-bedroom and turn the extra bedroom into a project room.
Buying a new home always comes with a certain amount of uncertainly. Due diligence and proper planning can go a long way to avoiding finding yourself in a situation you can’t get out of, at least not without it costing you. Better to have 20/20 foresight than hindsight!