Regular Mistakes Home Buyers Make

Owning your own home is a classic ambition. It is on the list of typical rites of passage that are meant to signal a shift in your status marking you as a full-fledged adult.

12 October 2020

Common Mistakes and How to Avoid Them - Vie Financial

Owning your own home is a classic ambition. It is on the list of typical rites of passage that are meant to signal a shift in your status marking you as a full-fledged adult.

As exciting as purchasing a home is, many potential homebuyers discover that what looked easy and fun online, feels stressful and difficult once the process begins. Do not let the details and confusing lingo surrounding the home buying process overwhelm you. We can guide you through purchasing your home and make the process enjoyable.

Avoid underestimating costs

Definite Don’ts for Prospective Purchasers

No matter if you are planning on buying your very first home or your 14th, there are always a few pitfalls along the way. Save yourself time, aggravation, and money with some helpful advice from the pros.

Do Not Go It Alone

Many buyers come to us filled with angst and regret because they mistakenly believed that they did not require any professional guidance during the home buying process. There are several important junctions you will reach when buying a house where a seasoned professional in your corner will be a big advantage.

Obtaining a Loan

While you are free to go to a slew of lenders, remember that every inquiry leaves a mark on your credit history. A mortgage professional has leads and contacts that you do not; this allows them to get you a better rate with less strain on your credit report.

Negotiating the Terms of the Sale

It is human nature to avoid confrontation and conflict. Many home buyers cheat themselves in an attempt to be polite. On the other hand, some clients lean the opposite direction and view the seller and their representatives as the enemy. While courtesy is essential in all areas of business, a professional will have experience walking the fine line of guarding your best interests and being civil.

Calling out Inappropriate Practices

While we hope that those who do business with us are upright and just, the unfortunate truth is some seller representatives will go to great lengths to come out on top in a deal. A professional who has experienced hundreds of property sales will know if something is amiss and can request that the seller remedy the situation.

Avoid Underestimating Costs

In a perfect real estate transaction, all of the numbers you have in your head will mesh seamlessly with the numbers on the table. Unfortunately, this is exceedingly rare. Many buyers slip in over their heads because of unrealistic cost estimates. In this situation, talking with a person familiar with everyday costs such as an agent or even dear old Dad can enlighten prospective buyers about real-world expenses of homeownership. Here are some fixed prices that come with purchasing a property.

  • Stamp Duty

    Inexperienced buyers often underestimate the cost of stamp duty, or they fail to consider it. This is a property tax collected by all Australian states. The amount you pay depends on loan purpose, the purchase price of your property, and the location of your property. While individual amounts vary, it is quite common for stamp duty to cost upwards of ten thousand dollars.

  • Conveyancing Fees

    This is the fee paid to the professional who is transferring your property purchase. This typically costs about 1,000 to 2,000 dollars depending on the complexity of the transfer.

  • Lenders Mortgage Insurance

    This insurance is in place to protect the lender if you default on your loan. This only applies to those home buyers who do not have a 20 per cent down payment.

  • Fees for Inspection

    Whether you are buying a property to flip or plan on meeting your first grandchild on the premises, be sure to have the building checked for structural integrity and the presence of pests. These inspections usually cost between $300 to $500 depending on location.

  • Insurance for the Home and Contents

    Your insurance costs will vary based on the amount of coverage, costs to replace the contents and structure, and the location of the property.

  • Fees

    When purchasing a home, you must plan on paying loan application and mortgage registration fees.

  • Skipping Pre-approval

    It may be tempting to rush headlong into the buying process. However, sellers and their agents see you as a better prospective buyer if you can show that you have financial backing ready.