8)Mistakes to Avoid When Moving to a Larger Home
5 Mistakes to Avoid When Moving to a Larger Home
Unlike the experience of buying a first home, when you're looking to move up and already own a home, certain factors can complicate the situation. You need to consider these issues before you list your home for sale. Not only is there the issue of financing to consider, but you also have to sell your present home at exactly the right time to avoid either the financial burden of owning two homes or, just as bad, the dilemma of having no place to live during the gap between closings.
This report outlines the six most common mistakes homeowners make when moving to a larger home. Knowledge of these six mistakes and the strategies to overcome them will help you make informed choices before you put your existing home on the market.
1. Rose-colored glasses
Most of us dream of improving our lifestyle and moving to a larger home. The problem is sometimes a discrepancy between our hearts and our bank accounts. You drive by a home you fall in love with only to find that it's already sold or more than what you are willing to pay. Most homeowners get caught in this hit-or-miss strategy of house hunting when there's a much easier way of going about the process. For example, find out if your agent offers a Buyer Profile System or House-hunting Service, which takes the guesswork away and helps to put you in the home of your dreams. This type of program will cross-match your criteria with ALL available homes on the market and supply you with information on an ongoing basis. A program like this helps homeowners take off their rose-colored glasses and affordably, move into the home of their dreams.
2. Failing to make necessary improvements
If you want to get the best price for the home you're selling, there will undoubtedly be things you can do to enhance it in a prospective buyer's eyes. These fix-ups don't necessarily have to be expensive. But even if you have to make a minor investment, it will often come back to you tenfold in the price you can get when you sell. These improvements must be made before you put your home on the market. Investigate an equity loan that you can repay on closing if cash is tight.
3. Not selling first
It would help if you planned to sell before you buy. This way, you will not be at a disadvantage at the negotiating table, feeling pressured to accept an offer below market value because you have to meet a purchase deadline. If you've already sold your home, you can buy your next one without strings attached. If you get a tempting offer on your home but haven't made significant headway on finding your next home, you might want to put in a contingency clause in the sale contract, giving you a reasonable time to find a home to buy. If the market is slow and your home is not selling as quickly as you anticipated, another option could be renting it and putting it up on the market later - mainly if you sell a smaller, starter home. You'll have to investigate the tax rules if you choose this option.
4. Failing to get a pre-approved mortgage
Pre-approval is a straightforward process that many homeowners fail to take advantage of. While it doesn't cost or obligate you to anything, pre-approval gives you a significant advantage when you offer the home you want to purchase because you know exactly how much house you can afford, and you already have the green light from your lending institution. With a pre-approved mortgage, a seller will view your offer far more favorably - sometimes even if it's a little lower than another offer contingent on financing. Don't fail to take this vital step.
5. Failing to coordinate closings
With two significant transactions to coordinate with everyone involved, such as mortgage experts, appraisers, lawyers, loan officers, title company representatives, home inspectors, or pest inspectors, the chances of mix-ups and miscommunication increase dramatically. To avoid a logistical nightmare, ensure you work closely with your agent.
Being aware of these and other legal issues and seeking advice when you start looking for a new house, will help you avoid unpleasant surprises that could cost you your dream home. By understanding these tips and strategies, you will be well on your way to buying a home that meets your needs and provides enjoyment for years to come. I hope you found this post helpful, but please realize that this is just a tiny part of the overall process. Please call us at 858-281-4659 to build a plan together to realize your goals.