If you are getting ready to take the plunge from renter to homeowner, you may be receiving a lot of unsolicited advice from your nearest and dearest. It makes sense that you would want to chat with your loved ones who own a home for sale in South Lake Tahoe, CA to find out what to expect. Which means, your head could be spinning with all the new “information” you are getting. While they likely have the best of intentions, unless they are an area expert, you may be getting bad advice. In fact, there are a lot of South Lake Tahoe, CA real estate myths floating around. If you are buying a home in South Lake Tahoe, CA check out these myths.
Myth No. 1: You first need to search for a home
So many buyers turn straight to sites like Zillow or Realtor.com before they even reach out to their local South Lake Tahoe, CA Realtor. You may want to get a feel for your dream home or “be in the know” before you sit down with a local real estate agent. If you find yourself doing this, you are not alone. This is a common real estate mistake. It also happens to be one that can set you up for heart break. The first actual step of buying a home is getting pre-approved. Not pre-qualified. When you get pre-approved you know exactly how much you can spend and what your budget is. If you are going based on what you think you can afford, you could be searching for homes for sale in South Lake Tahoe, CA that are out of your actual price range. By getting pre-approved, you not only save yourself some heart ache, but you also save yourself time AND you look good for the seller.
Myth No. 2: Your down payment must be 20% minimum
This is one of the most common myths when it comes to South Lake Tahoe real estate. Yes, a 20% down payment is ideal in order to avoid Private Mortgage Insurance HOWEVER you can score a loan with as little as 5% down. You can even go lower to 3.5% if you qualify for an FHA loan. There are so many options for down payment assistance when it comes to buying South Lake Tahoe real estate. Do your research, talk with your South Lake Tahoe realtor and shop for loans.
Myth No. 3: A 30-year mortgage is the best option
Speaking of loans, a 30 year mortgage may be the most common, but it might not be the best fit for you. After all, just because you invest in your home longer doesn’t mean your monthly payments will be cheaper. Yes, the monthly payments could be lower than a 15 year loan however you might end up paying more. You see, with a 30 year loan you run the risk of borrowing the same amount of money for double the time and a higher interest rate. A 15 year loan could be a good fit for you. Both are great options depending on your situation so just be open minded and read the fine print.
Myth No. 4: You can’t buy a home with bad credit
After the recession, there are plenty of people that are still cleaning up their financial situation. If your credit is bad, you may not qualify for a conventional loan but you have the option of a FHA loan. FHA loans require 3.5% down and borrowers with scores under 600 can still qualify. If you are buying South Lake Tahoe real estate and think this may be a good fit, know that while it is a good solution, it may not be right for you.
Myth No. 5: The down payment is the only upfront cost
False! Yes, the down payment will get you in the door but there are also taxes, fees, inspection costs, credit reports, insurance and the seller might require the buyer to pay closing costs.
Myth No. 6: The asking price is non-negotiable
When buying South Lake Tahoe real estate you must know that everything is negotiable. You make an offer and so long as your credit is good, you are pre-approved and you have a down payment, the seller might be willing to negotiate. You can also use the home inspection as a negotiation tactic in your favor depending on what the results are.
Myth No. 7: You don’t need a home inspection
Buying a home as is could be a financial disaster. Not all problems are visible, which means there could be some sinister (and costly!) issues lurking below the service. You may feel like you need to waive an inspection to beat out the competition but know that could be a huge disaster. You will want to talk with your South Lake Tahoe Realtor about this one in depth.
Myth No. 8: You don’t need an agent
If you think you don’t need an agent to buy Lake Tahoe, CA real estate because you have internet, think again. When you align yourself with a qualified realtor in South Lake Tahoe, you get everything from search results, inside information and a skilled negotiator on your side that can help you navigate any bumps in the road. For more information on buying or selling Lake Tahoe, CA real estate, give me a call.