{"id":2874,"date":"2018-01-15T05:33:24","date_gmt":"2018-01-15T05:33:24","guid":{"rendered":"http:\/\/tribekabiz.co.ke\/?p=2874"},"modified":"2018-01-15T05:33:24","modified_gmt":"2018-01-15T05:33:24","slug":"7-dumb-reasons-people-cant-buy-a-home","status":"publish","type":"post","link":"https:\/\/tribekabiz.co.ke\/index.php\/2018\/01\/15\/7-dumb-reasons-people-cant-buy-a-home\/","title":{"rendered":"7 Dumb Reasons People Can’t Buy a Home"},"content":{"rendered":"

Buying a home\u2014especially if it\u2019s your first\u2014can be a lot like losing weight in the sense that people end up doing, well, some pretty dumb\u00a0stuff in the process.\u00a0But while\u00a0desperate dieters might waste money on \u201cmagical\u201d weight-loss pills or\u00a0silly exercise equipment (remember the\u00a0shake weight<\/a>?), misguided home buyers could be doing far more serious damage\u2014like undermining\u00a0their ability to purchase a house at all. Don’t be one of them!\u00a0We asked real estate agents to shed light on some of the dumbest reasons people can’t buy a home. The good news? These\u00a0flubs are easily avoidable. Read on\u00a0and beware.<\/p>\n

Dumb reason No. 1: Waiting to line up financing<\/h2>\n

Your first step in the home-buying process should be to meet with a mortgage lender to discuss your financing options, says\u00a0Benny Kang<\/strong><\/a>, a real estate agent in Irvine, CA.<\/p>\n

\u201cYou don\u2019t truly know what you can afford until you meet with a lender,\u201d says Kang. In other words, just because you\u00a0think<\/em>\u00a0you can buy a $1 million house doesn\u2019t mean you can actually get a loan to\u00a0purchase a home that nice.<\/p>\n

Dumb reason No. 2: Using a fly-by-night mortgage lender<\/h2>\n

The mortgage industry is rife with scams\u2014including a slew of fake or unreliable lenders. Placing your trust in a bad lender can cause\u00a0a deal to fall through. That explains why \u201csometimes sellers reject offers because of the buyer\u2019s lender,\u201d says\u00a0Philadelphia real estate agent\u00a0Kathy Conway<\/strong><\/a>. To make sure your financing is rock-solid, ask your real estate agent for lender recommendations instead of, say, just Googling it. And read up to know your\u00a0mortgage\u00a0basics<\/a>.<\/p>\n

Dumb reason No. 3: Getting pre-qualified\u00a0rather than\u00a0pre-approved<\/h2>\n

Pre-qualification and pre-approval might sound similar, but they\u2019re not. Essentially, anyone can get pre-qualified for a loan, because\u00a0it only involves having a conversation with a lender about the state of your finances (no documents are exchanged).\u00a0Getting pre-approved<\/a>, meanwhile, involves the lender gathering all necessary documentation\u2014your tax returns, bank statements, pay stubs, and more\u2014packaging the loan, and submitting the file to an underwriter for review. If everything checks out, the lender will issue you a written commitment for financing up to a certain loan amount that\u2019s good for up to 90 or 120 days.<\/p>\n

When you submit an offer on a home, you\u2019ll need to include a pre-approval letter from your lender, says Conway.<\/p>\n

\u201cEducated sellers won\u2019t even entertain an offer unless the buyer has a letter of pre-approval\u201d from a reliable lender, Conway\u00a0says.<\/p>\n

Dumb reason No. 4: Shopping outside your\u00a0price range<\/h2>\n

\u201cIt sounds obvious, but some home buyers just have trouble sticking to a budget,\u201d says Kang. Therefore, resist the temptation to shop online for homes that are simply\u00a0outside your price range<\/a>\u00a0(i.e., how much you\u2019ve been pre-approved for).<\/p>\n

Dumb reason No. 5: Making lowball offers in a seller\u2019s market<\/h2>\n

You need to rely on your real estate agent to determine whether a house that you\u2019re interested in has a fair listing price. (Your agent will do this by performing a comparative market analysis, which entails looking at recently sold properties that are comparable to the house that\u2019s up for sale.) If a home is priced well, it might\u00a0make sense to offer full price, says Kang. Moreover, \u201cif you\u2019re in a seller\u2019s market, making a crazy lowball offer can piss off the seller\u201d and kill your offer, says Kang.<\/p>\n

<\/h2>\n

Dumb reason No. 6: Making a big purchase while in escrow<\/h2>\n

Some home buyers make the mistake of\u00a0opening new credit accounts<\/a>while they\u2019re in the process of buying a house. But purchasing a big-ticket item like a car or a boat while you\u2019re buying a house can jeopardize your financing. Why? Because your mortgage lender\u2019s underwriter is going to re-evaluate your finances and recheck your credit report shortly before closing in order to determine that you\u2019re still able to qualify for the loan.<\/p>\n

\u201cEven buying a fridge can throw off your credit or debt-to-income ratio,\u201d says Conway. Translation: Don\u2019t make any big purchases until\u00a0after<\/em>\u00a0you close on the house.<\/p>\n

Dumb reason No. 7: Not budgeting\u00a0for closing costs<\/h2>\n

If you don\u2019t have enough cash to cover\u00a0closing costs<\/a>, you won\u2019t make it to settlement; and if that\u2019s the case, you could lose your earnest money deposit. Thus, make sure to get an estimate from your mortgage lender of what your closing costs will be\u00a0before<\/em>\u00a0making an offer on a property (currently, this is legally required\u2014just make sure to read it).<\/p>\n

Closing costs vary widely by location, but they typically total 2% to 7% of the home\u2019s purchase price. So on a $250,000 home, your closing costs\u00a0could come to\u00a0$5,000 to $17,500. Both buyers and sellers usually pitch in on closing costs, but buyers shoulder the lion\u2019s share of the load (3% to 4% of the home\u2019s price) compared with sellers (1% to 3%), so you need to make sure you have enough cash on hand\u00a0to pay your portion.<\/p>\n

 <\/p>\n

Source:\u00a0 8 Dumb Reasons People Can’t Buy a Home<\/p>\n

By\u00a0Daniel Bortz<\/a><\/span>\u00a0|\u00a0Jul 11, 2017<\/p>\n","protected":false},"excerpt":{"rendered":"

Buying a home\u2014especially if it\u2019s your first\u2014can be a lot like losing weight in the sense that people end up doing, well, some pretty dumb\u00a0stuff in the process.\u00a0But while\u00a0desperate dieters might waste money on \u201cmagical\u201d weight-loss pills or\u00a0silly exercise equipment (remember the\u00a0shake weight?), misguided home buyers could be doing far more serious damage\u2014like undermining\u00a0their ability […]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[],"class_list":["post-2874","post","type-post","status-publish","format-standard","hentry","category-uncategorized"],"_links":{"self":[{"href":"https:\/\/tribekabiz.co.ke\/index.php\/wp-json\/wp\/v2\/posts\/2874","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/tribekabiz.co.ke\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/tribekabiz.co.ke\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/tribekabiz.co.ke\/index.php\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/tribekabiz.co.ke\/index.php\/wp-json\/wp\/v2\/comments?post=2874"}],"version-history":[{"count":1,"href":"https:\/\/tribekabiz.co.ke\/index.php\/wp-json\/wp\/v2\/posts\/2874\/revisions"}],"predecessor-version":[{"id":2875,"href":"https:\/\/tribekabiz.co.ke\/index.php\/wp-json\/wp\/v2\/posts\/2874\/revisions\/2875"}],"wp:attachment":[{"href":"https:\/\/tribekabiz.co.ke\/index.php\/wp-json\/wp\/v2\/media?parent=2874"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/tribekabiz.co.ke\/index.php\/wp-json\/wp\/v2\/categories?post=2874"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/tribekabiz.co.ke\/index.php\/wp-json\/wp\/v2\/tags?post=2874"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}