There are several major Daytona Beach home buying mistakes that could cost you a minor fortune if you slip up and commit these errors. Even so, there's plenty you can do to affect how much money you spend on a purchase.
A lot rides on your choice of real estate agent. A disturbing finding in a survey by Consumer Reports showed that 86 percent of agents said they witnessed other agents engaging in poor business practices which could cost consumers money. About a third said they saw agents steer buyers toward homes that would give them higher commissions. Others said some brokers exaggerate when marketing themselves. And 27 percent even knew of brokers who tried to persuade clients to sell a home for less than it was worth.
Avoiding Daytona Beach Home Buying Errors
Rushing Into a Deal
One of the more costly Daytona Beach home buying mistakes is agreeing to too high a price on a home. A related mistake is overestimating one's knowledge of the real estate market. It's not until you've been in the Daytona Beach home buying market for a while that you know what homes are really worth. If you make an offer on the first house you fall in love with, you risk spending too much based on emotion, not practical sense. So take your time, go see lots of homes, and get a good idea of the local price scale. A tip: If you do enter into negotiations on a house and they come to a standstill, don't be afraid to walk away.
Biting Off More Than You Can Chew
Another mistake Daytona Beach home buying customers make that puts them in a more financially untenable situation is under-estimating the costs of home ownership. You can't just calculate the monthly mortgage. You also have to factor in your closing costs and all of the additional fees you'll owe. Many of the fees are negotiable, such as the home inspector's fee, the cost to do a title search, and your attorney's fee. And find out what the current homeowner pays for utilities, taxes, and other monthly costs, so you can be sure you can really afford that home. Also get estimates for repairs you want or need to make to the home before you move in.
Not Upgrading Your Credit Score
To get the most favorable rate on a loan, you have to have a strong credit profile, and that means a credit score of at least 740. Recently, if your score was 740 and you applied for a $300,000, 30-year fixed mortgage, you could qualify for a 3.75 percent interest rate, with monthly payments of around $1,389. If your score was below 680, the best rate you might expect would be around 4.25 percent, with a monthly payment of $1,476 for the same loan; over the life of the loan, you'd pay $31,130 more. Don't wait until the last minute to scrutinize your credit reports and make any necessary changes to improve your profile. If you find errors, be sure to dispute them. Get your credit score as high as possible before starting out on your Daytona Beach home buying expedition.
Not Shopping Your Mortgage
Just as important as getting your credit score as high as possible is shopping for that mortgage. Sticking with your regular bank could be costly. Approach several lenders, including banks and credit unions. You can search for national deals online. We don't recommend that you hire a mortgage broker to do that because he may be more focused on selling you a mortgage than getting you the best deal. And get pre-approved for a loan before you shop; sellers take preapproved buyers more seriously.
Skipping a Home Inspection
One of the biggest Daytona Beach home buying mistakes comes from people who do not get a home inspection and find out later there were big problems with the house. You want to be present during the inspection to learn about any costly repairs that might be needed and to get basic info on the home, such as where the electrical panel is and where you shut off the water. A home inspector can also point out repairs that will need to be done in the next few years based on the average life expectancy of things in your home.
We have more helpful tips on Daytona Beach home buying in our section on Daytona Beach Home Buying Tips to your right under Daytona Beach Real Estate Categories.
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