9 Buyer Traps and How to Avoid Them – Part 2

No Mortgage Pre-Approval
A pre-approval collects all of your financial information and runs it through a qualification system to ensure your income and debt ratios are within the right range of affordability for the price point you want to buy in. When you have a pre-approved mortgage, you can shop for your home with a greater sense of freedom and security, knowing as long as there are no unexpected surprises, funding should be available when you find the right home. Not having a pre-approval done could result in significant increased stress and frustration. 

No Commitment Letter
Before removing your financing condition, get a commitment letter from your mortgage specialist stating that your mortgage is unconditionally approval. Often mortgage specialists will offer a conditional approval, however certain requirements must be met before a firm approval is in place. Removing your subject to financing without this firm approval could put you in a tough position of buying a property you can’t yet afford. 

Inaccurate Survey
For residential property, the offer to purchase agreement states that the seller will provide a current real property report (also known as a survey or RPR). If this survey is not current, you may find that there are property changes that are not shown. Examples could include a storage shed, a neighbor’s new fence that is extending a boundary line or an addition to the deck. Be very clear that the survey is current; meaning what’s on paper is an accurate reflection of the property. Otherwise, you could be held liable for future changes, which could be very costly. For support on an up to date survey (real property report), talk to your Realtor or lawyer. 

Unclear Title
Ensure early in the negotiations that the transfer of title for your new home can be done free and clear. The last thing you want to discover when you’re in the home stretch of your purchase is that there are encumbrances on the property such as tax liens, undisclosed owners, easements etc. that slow down or prevent you from taking over ownership. 

Not Doing a Final Walk Through
A final walk through is commonly seen when the seller agrees to do some clean ups or repairs to the property before possession. This benefits the buyer so that if there are any concerns of work being completed, it can be discussed a few days prior to your move in day. Not doing so, could result in delayed possession, or lawyers battling it out to get the work completed after your move in, which of course result in added costs. During your walk through, bring your list of agreed upon fix ups and walk through them, checking them off one by one.

We’ve only shared a few of the many potential pitfalls buyers can fall into and not realize it simply because they don’t know what they don’t yet know. Having a trusted, experienced Realtor on your side helps to alleviate these concerns so that you can confidently take the right steps to get into the right home. If you or anyone you know has considered buying or selling a home, give us a call. It’d be our highest honour to serve you!