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9 Mistakes First-Time Home Buyers Make

by The Linda Frierdich Group - Century 21 Advantage

 

9 Mistakes First-Time Home Buyers Make

 

Buying a home is a complicated process, as it should be.  After all, the biggest purchase of your life should probably require necessary measures, time, and “getting all your ducks in a row.”  While it may be understandable that the process of buying a home is intensive, this certainly doesn’t help homebuyers navigate the housing or lending markets.  There are many mistakes that can potentially be made by home buyers, and some, in particular, tend to be made by first-time homebuyers.  Between the stress, misinformation or lack of information, and excitement of buying a first home, there are a lot of errors that can be made along the way.  Assembled here are a number of such examples, in hopes that they may get first-time homebuyers to think about these issues and how they may avoid them.

 

 


Not Attempting to Gain a Better Understanding of the Process

 

No one expects a first-time homebuyer to know the ins and outs of the housing and lending markets and processes.  The first thing a first-time homebuyer should realize is that it is okay that they not know everything; in fact, it’s okay to know nothing at all.  There is absolutely nothing wrong with asking questions.  Many first-time homebuyers make the mistake of not asking enough questions during the process of buying  home, for a number of reasons.  Being sure about the processes involved in buying a home help to ensure that a Buyer is truly happy with their purchase in the long run.  Actually, one of the best ways for first-time homebuyers to begin the process of buying a home is assembling a list of questions they have for both the real estate agent and the lender. 


Thinking You Can Do It Alone

 

When in doubt of how to complete a certain task, the best thing to do is consult a professional.  The same is true when someone is looking to Buy a home.  Meet with a few real estate agents and see how they suit you.  If one doesn’t quite click with you, there is nothing wrong with moving on to a different agent.  You should feel comfortable and confident in your real estate agent, because they will be helping you through the process.  It will be a lot more enjoyable if you are paired up with someone with whom you feel comfortable.   Your real estate agent can recommend a few lenders for you to contact, so that you can begin determining which of those individuals you will choose to work with.   It is important that you feel confident in your lender and his or her professionalism, trustworthiness, and abilities.  After all, he or she will be helping you finance your biggest investment.

 

Not Making Your Goals Clear

 

When speaking with both your real estate agent and your lender, it is important that you make your goals clear.  While your real estate agent can help you decide which characteristics of a home are most important to you, you need to be honest and open during these conversations.  Your agent will know the right questions to ask you to help you decide what you are looking for, but only if you make it clear that you need help and don’t know where to start.  Your lender needs to know what your financial goals are to help you decide what kind of loan you should be getting, as well as what price range of home you should be looking for.  It’s not just about what you can afford with your income; it’s about what you can afford with your income and other financial goals, such as saving.

 

Failing to Take Saving into Account when Budgeting

 

What you can afford doesn’t simply boil down to what you are comfortable paying each month when considering other expenses.  You should also be considering planning for your future and saving money when determining what you can afford.  Too often, this aspect of a budget is overlooked by first-time homebuyers.


Not Knowing (or Ignoring) What You Can Afford


The excitement of owning a home often overtakes first-time buyers, leading them to neglect assessing what they can afford, as well as what their budget means to what kind of home they will find.  While it’d be nice if our first homes were all our final homes, and we could afford our dream house right off the bat, that’s just not realistic.  Too often first-time buyers get mixed up in their ideas of their “perfect home” and their “perfect for right now” home.


This concept is also important for first-time buyers to consider for a different reason.  Often, buyers who have never owned a home before realize that their budgets are limited and decide that they will purchase a home that needs a lot of work, a “fixer-upper” and make it their own on the cheap.  Assuming that a fixer-upper is cheaper than buying a move-in ready home is naïve and, often, inaccurate.  Even professionals who know what they’re doing can end up sinking a lot of money into a home that needs work.  If you are considering purchasing a fixer-upper as your first home, make a list of all the projects that will need to be done for you to update the home, do a little research, and start weighing the actual costs.  Don’t forget, also, that most of the time, any single project ends up costing more than expected, because projects usually hit snags along the way.


Failing to Acknowledge that Needs/Wants will Change over Time

 

While it is important that buyers consider that their first home will probably not be their forever home, it is also important to realistically analyze how long they think they will be in their house.  A third-floor condo may be great for right now, but if a Buyer is planning on getting a dog in the near future (while they are still planning on being at that residence), they should be considering the two flights of stairs for every trip outside with their dog. 


Becoming Distracted by Over-the-Top Features

 

It may be extremely cool that a house you looked at has a wine cellar or pool in the backyard.  However, if you don’t have the money to ever have the ability to stock that wine cellar, or if you don’t have the money or means to maintain that pool, neither of those features will retain their “cool” factor.  First-time homebuyers often make the mistake of becoming enamored with special features of a home, even if they are impractical or out of the range of what can be afforded.

 

Not Hiring an Inspector


Even if an inspection is not required by your mortgage lender, get one.  Even if the home is being sold as is, get one.  Even if the cost will come our of your pocket, get one.  Regardless of the circumstances, you should make an effort to know what exact home you are purchasing.

 

Changing Finances During the Home Search

 

Your pre-approval or pre-qualification is considered from the current financial situation you were in when you sought it out from your lender.  The numbers will change if your financial situation changes.  Change jobs, and your qualifications change.  Get a car loan, and your qualifications change.  Take out a line of credit to furnish your new house, and your qualifications change.  Make a late payment, and your qualifications change.  It is so very important, during your Home Search and especially during the period of time between signing a contract and closing on a house, that none of your financial situations change. 


Overall, there are so many things that can be done wrong when buying a house.  Without experience in the process, it’s very difficult to know what to do and what not to do.  That’s why it’s so important to learn all you can and be honest with the professionals you are dealing with. 

 

Did we forget something?  Let us know in the comments!

Questions Every Seller Should Ask Potential Real Estate Agents

by The Linda Frierdich Real Estate Group

Questions Every Seller Should Ask

Potential Real Estate Agents

 

So you've decided to list your home, and you're ready to begin the process.  You know that the first step is to hire a GREAT real estate agent, but you want to make sure that you make this listing count, because this is not only the biggest investment of your life, but you also understand the importance of choosing the right real estate agent to help you along with this process.  From experience to marketing strategies, there are so many things to consider when you are looking to hire someone to help you with this endeavor.  It is so important that you give yourself options during this time.  Be sure that you do some research into the real estate agents in your area, and also know that it's a great advantage to interview more than one agent.  By interviewing a few agents, you can get a good idea of what is working in your market, as well as what isn't working.  The trouble is, it can be difficult to know what to ask, because there are certain things that you wouldn't know about unless you were very educated on the housing market.  Here is a list of questions that you should be asking every agent you meet with, so that you may better understand who would work best for your needs.

 

 


 

  • How long have you worked in Real Estate?
    • This question is general but so important.  A fresh face has a lot of advantages in most cases, but in the real estate market, you're much better off to be working with someone who has been in the industry for a long time.  Those "seasoned" agents have seen the market fluctuate over the years, and they have learned to be successful during all kinds of housing market circumstances.  Furthermore, their experience with all aspects of the buying and selling processes can be such a huge advantage for you, the seller.  They will be able to recommend the best of the best of any service providers you may need, from inspectors to electricians to lendors to movers.  





  • Do you have any advanced real estate designations or education?
    • This particular question is essential in your interview process.  In the ever-changing real estate marketplace, you want to be sure that you choose someone to represent you who works dilligently to keep up with the trends and technologies.  As quickly as technology changes and develops, the best ways to market in real estate change along with it.  Talk with the agents with whom you interview to make sure that they are committed to keeping up with their trade to be more effective.  Ask them how often they attend conventions, and ask them how they plan on continuing to keep up with technology and the changing marketing landscape.  It's hard to know what any of the acronyms they will mention mean, or which ones to look out for, so to help you get an idea, you can find a list of common real estate designations and their definitions here.




  • How much real estate have you sold in your career?
    • This question is in the same realm as, "How long have you worked in real estate," except that the answer to this question gives more insight into effectiveness.  If your agent has been working for many years in real estate, but he or she hasn't sold nearly as much as another agent who has been in the business for a comparable amount of time, you may reconsider choosing the agent.  An agent can work very hard, but if they are not producing the results they should be or could be, they probably aren't the person you want to hire.




  • Where do you rank in market share statistics?
    • This question is important, because these answers will give you more insight into what agent is the best in your area.  By asking to see their market share rankings, you are making sure that you are presented with concrete evidence of their ability to deliver great results.  Talk to them about other realtors who compete with them, and ask what they think is responsible for their ranking as compared to the rankings of others.  Remember, it may seem like an agent has the upper hand in an interview process, because they come in with plenty of information and experience, but you are interviewing them.  If they're good at what they do, they'll be able to answer all your questions with ease, and this question is such an important one.




  • How long have you worked in the area?
    • Hiring an agent that has experience in the area where you are selling is so very important.  Real estate markets can vary substantially from town to town, county to county, state to state.  Not to mention, the demographics of certain areas react differently to different homes and marketing strategies.  You want to make sure that you are hiring an agent who knows your area well, as well as the people who live there or would be interested in buying a home in the area. 




  • How many referrals do you receive?
    • Any real estate agent who really does a good job will be more than happy to show you an extensive list of referrals from past clients.  Reading at least a dozen of these is important, because it will give you a great insight into what the agent focuses on, what their strengths are, and how well they communicate and work with their clients.




  • Do you work weekends?
    • So much of the activity that happens regarding a listed home happens during the weekend.  Those who can't make it to view homes during the week schedule their showings for the weekend.  Also, any Open Houses that take place at your home will be occuring during a weekend.  Ask any potential agents you interview how often they work weekends, because this can often give you insight into how committed they are to the success of their listings being sold.  If the agent you are interviewing works with a team, it's a good idea to ask about the members of their team and how often they work weekends, as well.



  • Can you give me an outline for how you will represent me?
    • To move forward with hiring an agent, you want to feel comfortable with them and confident in them.  A big part of how well they do their job is how well they explain the process to you, because the process of selling a home can be complex and extensive.  You are hiring them to take a lot of that stress and pressure off of you, so it's a very good idea to see how they explain the process to you, as well as whether or not they give you a physical outline of what to expect.  This step shows a level of professionalism that is essential to a successful and smooth real estate transaction.



  • Do you have a marketing program?
    • A marketing program that is intensive and comprehensive is essential in today's real estate market.  You should be listening for an answer that involves your listing being featured on many listing sites, especially the Multiple Listing Service. You also want to be sure that your listing will get plenty of attention on a variety of social media platforms, because the public is visiting these sites more and more to get details and the latest news on listings.  The importance of online listing management and social media promotion is growing, and it is showing no signs of slowing down.  You want to be sure that you are hiring an agent that takes that importance seriously and is committed to staying active, dilligent, and relevant in the online marketplace.  

Overall, the choice of a real estate agent is ultimately up to the confidence you have in them and how well you connected with them as a person.  However, there are many things you can do to make the interviewing experience better, starting with getting great responses out of them when you ask these questions.  A great agent will be able to offer you everything you have asked for, as well as more.  

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Contact Information

Photo of The Linda Frierdich Real Estate Group Real Estate
The Linda Frierdich Real Estate Group
Century 21 Advantage
103 S Main St
Columbia IL 62236
IL: 618.281.7621

138 Concord Plaza Dr
Saint Louis MO 63128
MO: 314.649.0221
Fax: 618.281.4311

Linda Frierdich is the area's premier real estate professional, offering services in St Louis, Kirkwood, Webster Groves, Crestwood, Ballwin, Arnold, Fenton, Oakville, Columbia, Waterloo, Millstadt, Valmeyer, Dupo, Belleville, O'Fallon, Mascoutah, Fairview Heights, Smithton, Ruma, Hecker, New Athens, Edwardsville, Collinsville, Caseyville, Shiloh, Swansea, Monroe County, Madison County, St Clair County, and Randolph County.  Her team focuses on resale homes, new construction, first time home buyers, condos, farms, land sales, subdivisions, lot sales, single family, multi-family, commercial, foreclosures, bank owned property, military relocation, and building. This site offers options to search real estate in Columbia Illinois and other areas. We offer buyer and sellers services second to none!

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