Buying a home in Palm Beach County can be a fascinating exercise for a home buyer. It can also be frightening because of the pitfalls involved in the procedure. Thankfully, you can avoid these common mistakes many first-time home buyers commit if you are aware of these mistakes.
1. Not utilizing the services of an attorney during closing
When buying Palm Beach County property, many think they are covered and protected as they have a reliable real estate agent. Remember that the job of a real estate agent is to find a home, not to check and complete legal formalities. This is where the role of a qualified attorney comes into the picture. Also, your agent’s fee is usually paid out of the proceeds and not your pocket. Your attorney not only looks at the agreement between you and the seller from a legal point of view but also safeguards your interests. Hire an independent attorney, not the one your agent or seller recommended. This professional will check if all the documents are by the provisions of the law at the time of closing. When buying a Palm Beach Property, you can have total peace of mind when an experienced attorney represents you. By law, you are not required to hire the services of an attorney at the time of closing in the state of Florida. But having an experienced attorney by your side when buying a property at the time of closing makes you comfortable as you know there is a professional safeguarding your interests. He also expedites the process of closing and completes it in a smooth and hassle-free manner.
2. Overlooking problems with mold and the cost of remediation
Mold is a big problem in homes in entire Florida. Mold thrives in warm and damp places, and Palm Beach County’s climate presents ideal conditions for mold to develop and grow fast. High humidity is one reason mold is a big problem in Palm Beach County properties. Even if you and your family are not allergic to mold, it is prudent to get the property adequately inspected for the presence of mold. Mold can create breathing problems for your family and potentially harm your family’s health. Mold remediation can be a costly and time-consuming affair. It is in your interest to either avoid buying a property infested with mold or negotiate with the owner to lower the asking price.
Some buyers skip home inspection just because they like to save money that is paid in the form of a fee to an independent professional. The cost of a home inspection in Palm Beach County can range from $300-$500 depending upon the size of the property and what is included in this inspection. Imagine the kind of risk these home buyers are ready to take to save a small amount of money. Some buyers would like to believe the words of their seller, who says that the property is fine and there are no issues with it. Please do not make this mistake as the seemingly beautiful house may be a headache for you in the future as you discover various problems with it.
When appropriately done by a professional, a home inspection can reveal problems that can take thousands of dollars to fix. But once you buy the house and move in, you cannot ask for compensation from the seller. If you skip a home inspection and see mold increasing inside the home, you must spend money on its remediation.
3. Not doing due diligence at the time of title search
The tile of the property you are buying in Palm Beach County is just as important as the structure. You worked hard to find a beautiful home in the area through a Palm Beach property search. Now you must see to it that the seller has the full and clear ownership rights to the property so that these rights can be transferred to you without any problems. The seller in Palm Beach County pays title insurance and title search costs. As such, you should not ignore this critical aspect of buying a home, as it can have long-term legal repercussions for you. Buyers not paying attention at the time of title search can pay dearly later when someone else lays claim to the tile of the property in the future. A title search involves the verification of title ownership records. These documents prove that your seller legally owns the property title and has the right to sell the property to you.
Your lender in Palm Beach County asks you for a title search and insurance to safeguard his money. This is because he has held the mortgage for a long time and doesn’t want to find out that the property does not have a clear title. Your ender cannot afford to lose on his investment because of defects or clouds in the property’s title.
4. Not reading covenants for HOA
If you have decided to buy a house in Palm Beach County that is a part of a homeowner’s association, you will be subject to the rules in the declaration of CC&Rs. If you do not know, every HOA has its covenants, conditions, and restrictions that its residents must abide by. If the single-family home or the condo you buy is inside a planned community, you are bound to follow the rules and regulations imposed by your HOA.
When you close escrow, you are made to sign a series of papers, one of which is the CC&R’s. It says that you have read these CC&Rs and agree to abide by them. Violating them in the future can result in penalties and forced compliance that you may not like. Many HOA’s restrict the size and type of breed you can own as a pet. They also have certain covenants to limit residents from renting their units. They preserve the community’s character and maintain the residents’ general comfort level. There are also terms and conditions about the usage of shared properties that you may not like as a resident. It is therefore advisable to get a copy of the CC&Rs and go through the document to know what is allowed and what is not permissible once you become the owner of a Palm Beach County property. Please do not leave it up to the discretion of your attorney, as he may not be aware of your likes and dislikes in this regard.
Buying a Palm Beach County property in the wrong community can be a big mistake. You can do nothing but repent of your decision. This is where a knowledgeable real estate agent can help you conduct your Palm Beach property search. Once you clarify your likings and requirements, he will avoid showing you properties in communities where you can face a problem because of HOA covenants. Yes, you can save hundreds of dollars by skipping home inspection when buying a property in Palm Beach County. But you could end up paying not hundreds but even thousands of dollars if a significant structural issue is identified after moving in.
5. Not getting preapproved for a mortgage
This is another big mistake committed by many buyers in Palm Beach County. These buyers are confident about their ability to secure a loan from a lender as they think they have good credit and have a decent monthly income. These buyers start their house hunt and even sign the agreement with the property owner to close the deal on certain days. It is only later that they find that lenders are not giving them the amount required to fund their purchase. For example, if the agreement has been signed with the purchase price mentioned as $400000 and the lender is only approving a mortgage loan of $300000, the buyer has to fill the gap and arrange $60000 over and above a 10% down payment that he has saved in his bank account.
This can be a very embarrassing situation for the buyer, and if he cannot arrange the money in time, the agreement lapses, and he even forfeits the deposit he has paid to the property owner. To avoid being caught in such a situation when buying a property in Palm Beach County, it is necessary to get preapproval for a loan from a lender. This gives you a clear idea of how much the bank is willing to finance to purchase of a property.
6. Not looking at credit
If you are desirous of buying a house in Palm Beach County, you know you need help from a lender to finance your purchase. The first thing most lenders in Palm Beach County look at is the applicant’s credit report. The lenders can reject your application even if you earn a decent monthly income if your credit score is below average. Many buyers commit the cardinal sin of approaching lenders when they have a poor credit score. Their application is rejected as banks cannot take the risk of investing in a person who they consider untrustworthy. You should desist from approaching a lender if your credit score is low. It would help if you worked hard to improve your credit to become acceptable to lenders. You can always conduct your Palm Beach County property search later.
Even with an average credit score, banks will give you a higher mortgage rate than what they provide to borrowers with excellent credit scores. This can make you pay a lot more for a property than you would if you are charged a lower interest rate. It will also mean that your monthly repayments will be much higher, making the loan very costly. This is the reason why you should first work on your credit and only then approach a bank for a mortgage loan.
7. Placing faith in mortgage information available online
First-time homebuyers in Palm Beach County rely too much on online mortgage information like in other parts of the country. They have often gone through these terms and conditions and become overconfident about their financing. They do their financial calculation about the money they can secure from a bank to purchase a Palm Beach County property. But things happen slightly differently in the real world, and these Millennials bitterly understand this.
Of course, you are entitled to free information from banks and mortgage brokers on the net, but you should not believe this information in Toto. Remember, information on the internet is for general information purposes only. You need to seek clarification from the bank to confirm whether the rule applies in your case or not. Many buyers in Palm Beach County get rude when they are told they cannot get a particular interest rate or a certain amount of money as a mortgage.
The problem with information on the net is that readers accept it at face value. You should contact lenders and have a face-to-face chat with loan officers so that you can ask questions and get answers from them.
8. Not anticipating associated costs of buying
This is a widespread mistake committed by first-time home buyers in Palm Beach County. Many young buyers, in their excitement of having saved money for a down payment, believe that it is all they need to become a house owner. Yes, they will get the mortgage from a lender based on their credit report and financials, but they need to have the extra money in their account to pay for the associated costs of buying. In addition to credit report fee, appraisal fee, title insurance fee, Escrow, State tax, and survey fee, there are also property tax and mortgage insurance that the borrower must keep in mind when calculating the cost of buying a home in Palm Beach County.
Let us understand this through an example. If the Palm Beach County property you buy is priced at $250000, the bank will finance 80% of this price and ask you to pay $50000 as a down payment. In addition to this down payment, you require another 2-2.5% of the property’s value to close the deal. In this example, the total amount of money needed to complete the sale is $55756.
This example suggests that you should be prepared to spend money on closing the deal, and you cannot hope to be the owner by just saving a down payment in your bank account.
9. Not hiring the services of a real estate agent
There is so much information about home buying available on the internet that many home buyers believe they can buy a home on their own. There is no shortage of buyers who think they can save on the commission real estate agents charge for helping in buying a home. This is incorrect as the fee of the buyer’s agent comes from the proceeds of the sale, and it is the seller who pays the commission of both the agents.
Buying a home without a west Palm Beach real estate agent can be complicated and tiring. There are many legal formalities to be fulfilled, and the entire exercise, from making an offer to closing a deal, can prove very intimidating if you are a first-time home buyer in Palm Beach County. Therefore, having a reliable and experienced realtor by your side all the way through is very reassuring. His knowledge and experience help in removing obstacles from your path. This professional makes buying a Palm Beach County smooth and hassle-free.
Searching for a home that suits your requirements and budget in a given community or neighborhood can be a lengthy, drawn-out procedure. A good quality realtor helps identify and negotiates with the seller’s agent to lower the asking price. He helps draft a brilliant offer so that it is accepted and remains with you until the deal is finally closed and you can move into your new house. Not taking help from a reliable and honest real estate agent does not save you any money. On the contrary, buying exercise becomes more complex and nightmarish.
Buying a home can be challenging without the help of the best quality real estate agent. But when you have the best real estate agent helping you, you will find that all your questions are answered, and your requirements in terms of location, features, and even price range are fulfilled. Here it is important to note that you need to hire an experienced buyer’s agent, not a professional who primarily handles the sale of properties of his clients.
10. Not being ready to make the move
Palm Beach County is a hot housing market with strong demand from buyers. It is a seller’s market with very tight inventory. Median home prices for single-family homes here are $341500. The price per sq foot here is $190, less than $218 in Miami-Fort Lauderdale Metro Area. Sellers in Palm Beach County are getting multiple offers from buyers over and above their asking price these days. In such a market, it becomes necessary for a buyer to be prepared in all respects. Many buyers try to buy a house in Palm Beach real estate market without homework because they are mostly unsuccessful. If you are interested, get preapproved and make an irresistible offer to stand out from the rest of the buyers.