The 13 Don’ts of Home Buying Happiness

As you start your search to buy a home, remember these essential rules. Any mistake can cost you thousands of dollars and countless headaches and heartaches for years to come!

1. Don’t misunderstand your real estate agent's role.

Unless the agent is your exclusive buyer's agent, they are working for the seller. Most states require them to tell the homebuyer this in the beginning, but it's easy to forget. For best results, hire a buyer's agent who is contracted to work for you exclusively. This doesn't cost any more than a traditional agent.

2. Don’t show too much enthusiasm.

Don't let the seller or seller's agents know if you think a house is ideal. The seller could hold out for a higher price.

3. Don’t overestimate your financial position.

Analyze your assets, calculate your debts and pull credit report before you start looking. Get pre-approved by a lender for a mortgage. Use our calculator, "How much house can you afford?"

4. Don’t choose the wrong neighborhood.

Remember you're buying a house and a location. With the agent's help, find out about the quality of schools, the crime level and upcoming zoning issues.

5. Don’t make an uninformed offer.

Get a comparative market analysis that reveals recent asking and sales prices of similar homes in the neighborhood. Then, make an offer that is comparable.

6. Don’t overlook the obligations and hidden costs of home ownership.

Besides the mortgage, plan on paying for insurance, assessments (if any), property taxes, repairs, appliances, landscaping and improvements.

7. Don’t forget to put two important contingency clauses in the contract.

When making an offer, request two important clauses:

• A mortgage financing contingency stipulating that the home must appraise for the offered price. If not, you can cancel the sale and renegotiate the price or get back your deposit.
• A professional inspection contingency — If the inspection reveals hidden flaws, structural damage or faulty systems, you may choose to renegotiate or cancel the purchase. Consider going through the house with the inspector to learn any concerns the inspector has.

8. Don’t buy a house that may be difficult to resell.

Look ahead to the day you'll sell the house. Know the neighborhood and pay attention to marketable details of the house.

9. Don’t forget to set a budget

Buy a home that's way out of your price range and you could prevent funding other important items such as retirement savings, your kids' education -- not to mention an entertainment budget.

10. Don’t choose the cheapest neighborhood.

If you don't like the location you'll be unhappy. What's more, you'll probably have a hard time selling your property if the community isn't good. Do some research to learn how the community is faring economically, what the major issues are, how many resources it offers.

11. Don't overlook the schools.

Gather such data as test scores, statistics on the percentage of kids who graduate and go to college, the student/teacher ratio and so on. Talk to parents and students to get the inside scoop.

To find out the last two of The 13 Don’ts of Home Buying Happiness, please contact me via the “Questions? Just Ask!” box on the right — be sure to write "13" in the comments box.