Homebuyer Mistakes to Avoid

Buying a home is one of the most stressful times in your life! It’s a lot of money to spend and you want to be sure you’re being smart about it. With current housing conditions, most homes under $600k are moving very quickly so there isn’t room to sit around and debate your decision for a few days or it will be gone. Bidding wars are a common occurrence and houses are selling at and over asking price. If you can avoid making these mistakes, the process will be a lot smoother and less stressful, and you’ll have a better chance of getting that dream for you and your family!

Before Making an Offer

• Get pre-qualified to know how much you can afford

• Check your credit score and fix any errors that might be on there

• Take the time to raise your credit score if it’s not higher than 650

• Choose the RIGHT lender. Not all lenders are equal. Some will be a better fit for you and be able to help you more and close faster than others. Your agent usually will refer you to ones that they have worked with and are solid people to trust.

• Spending all of your money on your down payment and closing costs. Always have an emergency fund.

• Lacking vision. Doing upgrades can be less expensive than buying a house with the complete package.

• Indecision. A house you loved today and are thinking about buying might already have an offer being written from the person who loved it yesterday.

• Waiting longer than 24-48 hrs to see a home in Denver that just hit the market. In our highly competitive market, over 60% go under contract in seven days or less.

• Not choosing an agent. Get professional help. They are the experts in contracts, negotiations and knowing the market.

• Make sure to get a feel for the neighborhood. Walk the area, talk to neighbors, look at the upkeep of houses and yards nearby to get an idea of who would live around you.

After Making an Offer

• Turn in your Earnest Money on time. If you wait to long, the contract will be terminated.

• Don’t make any large purchases before closing that will change your credit.

• Make sure to go all in on inspections. This can make or break a deal and you’d hate to find issues after you close because you thought new construction couldn’t have issues.

• Do all the tests necessary on top on inspection: check the home for mold; get it meth tested if there were ever renters there; do a sewer scope, double check all systems are in working order!

• Sign all disclosures or the contract can be terminated.

• Make sure your lender orders appraisal on time to make the deadlines work.

• Have an agent who is on top of everything and communicative with you during the whole process.

Don’t let simple mistakes keep you from the home of your dreams! Contact me with any questions or concerns!

How to Save for a Down Payment on a Home

Even if you don’t plan to buy a home anytime soon, starting to save for a down payment is always a good idea. Unlike saving for retirement, where you won’t see the funds for years and can put away a little at a time, this is something that needs to be accessed much more quickly, so here are some steps and ideas to get the process started quickly.

Step 1: Figure out how much you need to save. Talk to a lender and determine how much you can qualify for when purchasing a home and how much you’d like to put down as a down payment. 20% is not a requirement.

Step 2: Determine your time frame. The shorter the time frame, the faster you’ll need to save. Divide the number of years by the total down payment you hope to put down.

Step 3: Start a budget. Look at your current monthly expenses and see where you can cut back. Be creative! Try to carpool more, cut coupons, bring lunch every day, rent out a room with AirBnB, or save on energy costs by reducing your use. Embrace the changes, it’s all worth it!

Step 4: Set up an automated payment. Unless you’re a natural saver, the best thing you can do is have a certain amount or percentage moved to a savings account each month. This helps make the process automatic and invisible.

Step 5: Start Today! Saving for a down payment is tough. It takes perseverance and focus, so the best thing to do is start now.

Biggest Myths in Real Estate

I thought a great way to start off my new website is to get some of the myths out of the way first so we can move right into the real deal!

Myth #1 - 20% down payment is required

This is so far from the truth, I want you to forget that you’ve ever even heard it! According to a recent survey, 48.6% of people believe this myth and leads to people renting longer than needed!

There are so many options out there these days that lenders can help you find the right one for you. Depending on the type of loan you are doing, you may not even need to do a down payment! Some conventional loan programs offer down payments of 3-5%, FHA can be as low as 3.5%, and for veterans and military service members, VA loans allow for zero down payment!

Considering Millennials spend close to $100,000 in rent by the time their 30, I’d say it’s time to clear up this myth!

Myth #2 - Seller’s should price their home high because you can always reduce it

One of the biggest myths in Real Estate. Sellers want to protect themselves. so they think if they start out over the asking price of their house, it’s a good defense mechanism against selling too low. Pricing a house wrong is basically the kiss of death and can lead to lots of frustration. Buyers in today’s market are quite savvy and do their homework. If they see your home is overpriced, they may not even waste their time looking at all! You have to entice with the price.

Myth #3 - Zillow says it, so it must be true

Has Zillow or anyone working for them ever been to your home and walked through it? Have they ever pulled relevant comps, made adjustments and given you an appropriate range of value?

‘Zillow’s Zestimate’ gives home owners a general starting point for the value of the home, but by no means is it accurate. It can’t understand why some homes on one street would be more value than on the next, or the difference a good school might make in driving some prices up in an area.

Myth #4 - Buyer’s should start with a low offer

Buyer’s often think that throwing in a low ball offer on a home is just a starting point and they can negotiate from there. While there is nothing wrong with negotiating at all, unfortunately a low offer will sometimes upset or offend the seller and they won’t even consider the offer, much less negotiate it. Today’s market is still a sellers market, so they have more power. It’s better to submit your highest and best offer to stay competitive until the market shifts.

Myth #5- I need perfect credit to buy a home

Many buyers are under the assumption that they can’t start the home buying process until their credit score is close to perfect. While better credit is a good thing and can help you get a good rate, most lenders just require a score of 640 to get the process going. FHA loans typically only require a score of 580 score or higher to begin the process, and if you’re under that you’re not excluded, but you will need a bigger down payment to begin the process. So stop hesitating and reach out to one!