Everyone knows that you need to do an inspection and in fact frequent readers of mine have read about me insisting that a sewer scope be done as well. 

To find out more about sewer scopes you can read my earlier post. 

The biggest Mistake a Seattle Home Buyer can Make.

Many buyer’s however are not as familiar with these ten things that can make a transaction very hairy. 

1.  Do not spend all of your savings on the down payment and closing costs.  Moving always carries with it extra expenses, not to mention all the cool furniture you will want to buy once you move in.  Keep a decent amount of money in reserve for the first six months after you move.  If you find you have too much left over after that you can always make an additional payment toward your principle. 

2.  Do not use the listing agent to purchase a home.   The listing agent has entered into an agreement with the seller to represent their best interests.  By agreeing to work with you and the seller at the same time, a situation is created where the agent gets paid double but honestly is not able to fully represent either the buyer or seller’s interests.  It is called dual agency and while it is a great payday for the agent and perfectly legal, it results in you getting less then great representation most of the time.  Since using a buyer’s agent isn’t going to cost you anything anyway, why not have your own agent negotiating on your behalf?

3. Have your agent do a walk through of the home prior to the day of closing.  The standard purchase and sale agreement allows for the buyer’s representative to do a walk through and visual inspection of the home prior to closing.  Most agents do not perform this service, but it is a big deal.   The walk through is to ensure that the owner’s possessions are completely removed and the home is in swept clean condition.  There is nothing that ruins moving day more then getting the keys for you new home and finding boxes and boxes of the previous owners junk still in the home.  Once the house closes that junk becomes your problem.  If it is discovered prior to closing, the closing can be delayed until the previous owner removes the items. 

4. Get everything in writing.  This one sounds like a no brainer, but it bears repeating.  Don’t assume that nice second fridge or big screen TV is included in the sale if it isn’t in the contract.  Even if you have gotten verbal confirmation that certain items will stay, if they are not attached to the property, you better get it in writing.  Otherwise the seller can take them with them and you will have not have any recourse.

5.  Visit the home more then once. It never ceases to amaze me that people make such an enormous emotional and financial decision, without visiting the home more then once.  I recommend, you visit during the weekday and also on the weekend.  It is also a good idea to visit the home in the daylight and also at night to see what the difference is. 

6.  Shop your loan.  I know people who will go to 10 stores before they buy a TV, but to only one bank for a $400,000 mortgage.  Banks do differ.  Once you know what you qualify for from one bank, see if you can’t beat that offer.  Good clients are in short supply and if you tell a bank you already have one pre-approval and that if they beat it they can have your business, they will jump through hoops to try to find you a better deal.  Banks jumping through hoops for you is a good thing.

7.  Schedule the closing for the early part of the month but not before the 5th.  You have to trust me on this one.  Banks will give you amnesty for the first month’s mortgage payment.  Obviously you want to have the longest possible period of time before your first payment.  If you close on the 6th of May for example, you will not have a payment in June.  Your first payment will be due July 1.  If however you close on May 4th, your first payment will be due on June 1st.  So do yourself a favor and close between the 5th and the 15th or so and save yourself a months payment.

8.  Never use an agent you can not meet face to face.  I love the internet (obviously), but I would never use a real estate or mortgage agent I can not reach by cell phone and meet in person.  It is criminal how many transactions go bad because some fly by night company offered some phenomenal deal to a client and then can’t be located when a problem comes up.  Fortunately the recent downturn has run many of the cheap skate agents out of the business, but they are still out there.  Be careful and work with a reputable agent you can see and get a hold of.

9.  Drive your commute.  Sure it was a snap getting to the house during the Sunday Open House and on the following Saturday when you brought your folks by with your agent, but what is the drive like on Friday at 5 PM?   How long will it take you to get to work if there is construction on the bridges or a Mariner’s game?   Make the drive to and from work during the time you will normally be driving.  That way there are no surprises when you move in.

10.  Always get the ALTA Homeowner’s title Insurance.  When you purchase a home the seller is going to pay for a title insurance policy for you to cover you in case there is a claim against title in the future.  There are three different kinds or levels of insurance.  Obviously the seller would prefer to get you the cheapest kind with the least amount of coverage, but don’t fall for it.  The cost between decent and good coverage is negligible and I have never seen or heard of a transaction being held up because the buyer insisted on a better title insurance policy.  The ALTA policy is pretty standard across the industry and is the coverage you want for the vast majority of residential transactions.

So there you have it.  10 very simple and very common mistakes made by buyers and bad agents. 

Give me a call if you need help.   I’d love to be your agent.

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Rob Graham, Accredited Buyers Representative

Windermere Real Estate

206-321-6349

robgraham@windermere.com

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