Mistake #5: Selling before getting pre-approved yourself
Entering into a contractual agreement to sell your house before you get pre-approved to buy another home is problematic. Your financial situation may have changed since your last purchase, and you now may not qualify for the type of loan you anticipate, or you may not be able to sell your house at a price that enables you to buy the kind of replacement home you want. As a result, you might have to rent or buy a less desirable house that is far from ideal. Before you decide to sell, get pre-approved by a trusted lender in whom you have confidence, and study the housing market in the area in which you want to live to get a good idea of how much it will realistically cost you to buy your next home.
Mistake #6: Wasting time on unqualified buyers
It is wasted effort to show your home to someone who cannot afford to buy it. For example, one seller spent two weeks preparing his home for an acquaintance who wanted to buy it. The seller spent $1,000 removing an old shed, and met with the prospective buyer several times to discuss price and terms. Unfortunately, it was well into the escrow process before the seller found out his friend could not qualify for a loan. You can avoid this mistake by working with an experienced agent. Top real estate agents spend considerable time and effort evaluating a potential buyer's qualifications before even showing a home.
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