6 Big Mistakes Daytona Beach Homebuyers Can Make
Here are the 6 most common and costly mistakes you can make as a homebuyer in our Daytona Beach area. (Hint - a good Realtor will help you prevent these.)
1. Not knowing your credit score, and concurrently, not knowing your buying power.
You must know your FICO score to apply for a loan, or find it out when you fill out the paperwork. If it is less than ideal, you will have to pay more interest and fees, which could price you out of the market. For instance, Fannie Mae and Freddie Mac charge higher up-front fees to borrowers whose FICO scores are below 740. Plan ahead and make a determined effort to raise that score and correct any errors (these are not uncommon).
2. Don't make any large purchases before you close on your house.
Lenders check your credit score up to the day the loan is disbursed and title transfers. They will find a new car loan, or applications for credit cards, or credit for other purchases. Not only could these make your FICO score drop to where it changes the terms of the loan (you thought was approved) but it could cause the lender to consider you a riskier borrower.
3. Don't be cheap when it comes to inspecting the home you've chosen.
Repairs later will always be more expensive than done when a problem is discovered. Inspections are usually a buyer expense, but the best insurance you can get. Hire a well-respected and experienced (in your area) home inspector and pest inspector, and understand their recommendations. Walk around the property while they point out the problems and see for yourself. Go into the purchase knowing the defects and estimated costs to repair.
4. Not using an attorney or Realtor.
Not every state uses lawyers for real estate transactions, but there will be a title company and you - as a buyer - can use a Realtor with no charge (in most states). Why not use professional help? Make sure you understand the contract terms, and what contingencies protect you.
5. Not using contingenies.
No Realtor worth their reputation will suggest you sign a contract without contingencies. Not only will it protect your earnest money, but give you an out for closing, should you find some reason the contract should be nullified (for instance, you can't get the loan at the last minute because your financial condition has changed).
6. Not getting insurance.
Don't underestimate costs, including insurance, utilities, and homeowner association fees. The lender will require home insurance, and possibly flood or hurricane, so factor these costs into your total budget for mortgage expense.
Use a professional Realtor to guide you through your home purchase, and you should avoid all of these costly mistakes.
Sherry Armstrong, Realtor
386-679-3191
yourkeytothebeach@gmail.com
www.sherryarmstrong.com
www.daytonabeachscene.com
www.ormondbeachscene.com