It is easy to let your heart rule your mind when buying something important. A quick look in your closet will likely reveal past purchasing decisions you got wrong. Yet, the consequences of making mistakes when buying real estate will be far more costly than those you make buying clothes.
When you buy clothes, the store gives you a guarantee that allows you to take them back in specific circumstances. By adding contingency clauses to a real estate contract, you get to customize your warranty, allowing you to cancel the deal if particular problems arise.
A successful real estate closing is subject to many variables
Unlike clothes, once you have signed for a property, you cannot return it because you do not like it. Here are three reasons you may be able to cancel the deal, however, with the right contingencies in place:
- You cannot afford it: Buying a dress might take you over your credit limit. Buying a home, you cannot afford will probably lead you to lose the property. Having the buyer of your home pull out could scuttle your purchase. So could having the mortgage lender withdraw their offer or alter the terms. You can include a contingency to say your purchase is dependent on selling your old house and securing a mortgage for the new one.
- It is faulty: Clothes and houses may all have faults, which you decide you can mend or put up with. Yet, some unexpected ones may be deal-breakers. A survey and a home inspection are essential to spot them while you still have the chance to retract your offer.
- It is not the seller’s to sell: This is the housing equivalent of buying a jacket from some guy on Facebook Marketplace, only to have his sister knock on your door to tell you it is hers and she wants it back. Take great care if someone has recently inherited a property. Inheritance disputes can cause some people to try and shift a property before their family finds out. Carrying out a title check is crucial.
If you would not dream of going clothes shopping without a trusted friend to advise you, consider how crucial it is to have trusted advice when closing on real estate.