Top Five Ways to Waste Money in Real Estate

Published by Lance Mohr | Filed under Home Buying Tips, Investing

Whether you are interesting in buying Tampa real estate for investment purposes or a beach front condo for retirement, chances are you will encounter a less than scrupulous agent, lender or other so-called “expert”. Unfortunately, what you don’t know can hurt you when it comes to buying and selling a home or condo in Tampa. Discover the top ten ways to waste money when buying real estate with these tips:

1. Courses that teach you how to buy for “no money down”. The fact is, most real estate requires a down payment but there are certain programs and methods of structuring loans that can reduce the out of pocket expenses. It’s also common knowledge; any reputable real estate agent or broker will be familiar with how to structure the purchase price of the home or what type of programs you may be eligible for in your community. Instead of spending money on the course, call a good agent and then use that same money toward your down payment.

2. Junk Fees. Many closing costs are standard while others have plenty of latitude; work with a real estate agent who doesn’t mind if you shop around for the lowest rates.

3. Avoiding an Inspection. Don’t be penny-wise and pound foolish by trying to save a few dollars. Pay for an inspection even on an “as is” property. The cost of the inspection is almost always offset by the savings and ability to negotiate price; few properties are perfect so find out the flaws up front then use it to your advantage when buying a Tampa home.

4. Mortgage insurance. If you fail to put a decent sized minimum down payment toward the purchase price of your home then chances are you will be forced to purchase Private Mortgage Insurance or PMI; this protects the mortgage company in the event of a default and can easily add $100 or more to your monthly payment.

5. Mortgage Life Insurance. While it is a good idea to purchase life insurance to make sure your family is covered in the event of a major loss of income; mortgage life insurance products are typically much higher than other available options plus, the benefit declines as the mortgage goes down each year. For example, term life insurance is usually much more affordable and retains the full value for the life of the policy.
Copyright 2008 www.tampa2enjoy.com

Tweet