Real Estate Agent-To Avoid 5 Mistakes Made by Millennial Homebuyers
Many millennials strive to achieve their dream of homeownership despite living in a competitive housing market. But missteps can be unforgiving, costing you your time, deposit, or leaving you liable for damages or other unforeseen costs. That’s why you need to take a proactive approach and avoid these common mistakes:
1. Incomplete Research
Treat a home purchase like any other business transaction and arm yourself with the knowledge to mitigate the risk of making a bad investment. For impartial advice, look beyond conventional sources.
According to the founder and CEO of Nobul, Regan McGee, “Millennials should not necessarily look to their local real estate board, national real estate Agents association and/or finance companies for objective, unbiased information.” He shared with Yahoo Finance Canada, “They all have their biases based on their own vested interests.”
2. Working with the Wrong Real Estate Agent
Surveys find that most millennial homeowners select the first realtor they interview, which can be problematic for several reasons. A less than stellar real estate agent may not be upfront about fees, fail to give you the time you deserve or push you into making decisions without preparing you for consequences. For instance, it’s not uncommon for a mediocre real estate agent to encourage you to put down a deposit without informing you that it’s forfeitable with possible penalties if you change your mind.
The Nobul platform provides a more transparent approach to connecting with real estate agents that puts the power in the hands of the home buyer or seller. Nobul is a real estate marketplace, the only of its kind, that uses sophisticated algorithms to analyze countless reviews and transactions to connect buyers and sellers with desirable, verified agents.
3. Being Unprepared for the Costs
There are all types of costs you must pay before, during, and even after a real estate transaction. Not being financially prepared for them is one of the costliest own goals you can score as a homebuyer.
- Overall down payment
- Appraisal fees
- Home inspection
- Home insurance
- Agent fees
- Legal fees
- Land transfer tax
- Property tax
- Moving costs
- Repair costs
- Maintenance costs
- Mortgage Insurance
- Service charges
- And more
4. Not Improving Credit Score
Even if you have enough in the bank to meet all expected costs, you must still boost your credit score. Alongside your debt-to-income balance, your credit score helps you qualify for a home loan approval with more favourable terms and rates. Although trying to raise your credit rating may feel intimidating, you can improve it in a few months with the right measures.
- Make timely payments.
- Reduce your credit card debt to 30%, if not less.
- Increase your credit limit.
- Examine credit reports for mistakes and dispute them immediately.
- Ask a family member with high credit to add you as an authorized user.
5. Skipping Mortgage Pre-Approval
While a mortgage pre-approval isn’t necessary to tour or buy a property, it can be helpful. It helps lock your rates for up to two months in the United States and four months in Canada, allows you to plan your budget, and helps you match with an agent that prefers pre-qualified clients.
Buying a home is likely to be one of the most significant transactions of your life. Avoid common mistakes to get the best prices, rates, a realistic understanding of the costs and your budget, and match with a helpful real estate agent with your best interest at heart.