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10 mistakes to avoid in real estate in 2006
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Hiring the wrong agent
Buyers and sellers should interview several agents, small and large. Get references and success stories. You may not benefit by opting for an agency's top-volume seller. That top-producing agent may have listed 40 homes last year and sold 30, but another agent may have listed 15 and sold 14. Opting for a friend or family member who is an agent doesn't assure you of results either. It could cause a rift. And choosing the agent who suggests the highest listing price is not a recipe for success either -- nor is opting for the agent who charges the lowest commission. Remember the SEED qualities in an agent: smart, empathic, experienced and dedicated will usually get the job done right.

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Missing the big picture
Opting for a dream house that will otherwise create negative quality-of-life challenges such as longer commutes, distant schools, limited access to services, higher taxes, more stringent deed restrictions, stricter homeowner associations and other chronic headache-makers can cause buyers to question their decisions after a few months. Make sure your that dream house is grounded in reality.

Not knowing what you're signing
The sales contract is a legally binding document. Review it as if your legal well-being is at stake. It should address all your concerns and the concerns of the other party, such as who will pay what for closing costs and repairs expenses. A poorly written or incomplete contract can cost you lots of time, money and emotional energy and tie up your deal for weeks or months. If there have been any verbal commitments, they should be put in writing. If you're not using an attorney, make sure your agent is proactive in the construction and interpretation of the contract before you sign it or make concessions.

Poor timing
How many stories have you heard about people drowning under the weight of two mortgages because they committed to a new house before selling their old one? The most important transaction in the "buying-one-and-selling-one scenario" is the sale. Sometimes, you have little choice in the matter, but when you do, secure the sale of the old house before signing on the dotted line for the new one. Sure, you hate to miss out on that rare find and you might have to find an interim rental, but that's better than spending time in financial limbo and biting your fingernails to the quick.

Not completing your due diligence with a criminal search
In many states, agents are not obliged to tell you if there is a sex offender or other unsavory resident in a neighborhood you're eyeing unless you ask. Do so. They tell you to do your own research. Do so. Check with your area law-enforcement agency about how to access sex-offender lists and other criminal data bases for this crucial information.

Bankrate experts' advice
Repeating your money errors of the past is a sure way to personal finance wreck and ruin.
Here, Bankrate columnists identify their picks as the worst mistakes you can make when it comes to your finances in the areas of real estate, debt, taxes, bankruptcy and personal finance, along with tips on how to avoid them next year.
Thrifty 60
1. 10 big bankruptcy blunders
2.10 missteps that will plunge you into debt
3. 10 real-estate wreckers
4.10 terrible tax mistakes
5. 10 top money errors
6. 10 miscues when dealing with debt collectors

 

 

Bankrate.com's corrections policy -- Updated: July 31, 2006
 
 
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