1. Using an out-of-town lender. Obtaining a mortgage in a timely and hassle-free manner is the “key” that opens the door to your new home. If your lender fails to fund your loan on time, you risk losing your earnest money deposit and the property you hope to buy. Lenders who live in St. George have already established the contacts necessary to process your loan in an efficient and timely manner.
   
   In addition, Utah regulates and licenses mortgage brokers and lenders. Loan officers doing business in Utah must be licensed by the state. Lenders from other states may not know Utah laws and regulations. And, an out-of-state lender may not even know that, by law, they must have a Utah license.
   
   Therefore, ask your St. George real estate agent for lender recommendations.  Your agent will have long-term relationships with reliable and trustworthy lenders.
   
   If it is important to you to use a lender from out of state (e.g., a family member, a friend), your best bet is to have your lender refer your business to a Utah lender (preferably one in St. George). This will help ensure that your out-of-state lender receives a referral fee and doesn’t violate Utah mortgage laws. But most importantly, it will help you close quickly on the St. George home you want to buy.
   
   Mortgage story: The very first transaction I was involved in after I got my real estate license became a nightmare due to a negligent lender. I was representing a buyer from Las Vegas who insisted on using a Las Vegas lender. Unfortunately, the lender rarely returned calls or answered his phone. He failed to close on time. We extended the closing date time and again, and time and again the out-of-state lender failed to have the loan ready. The buyers were frantic and the sellers were angry. Finally, eight weeks after we were first scheduled to close, my buyers dropped the Las Vegas lender and went with a local lender that I recommended. To my buyer’s amazement, just because we used a local lender, we closed on the new St. George home 10 days later.
   
   
2. Not using a loan approval letter when making an offer on a property.
   You’ve found “The Home” and want to make an offer to buy it. Anybody can make a full price offer and get it accepted, but what if your dream house is priced at $275,000 and you offer $250,000, saying that you will pay for the home by getting a new loan?
   
   The sellers, when presented with your $250,000 offer, know nothing about you except that you think their home is worth less than they think its worth. At that point, the sellers will probably do one of two things. They might reject your offer outright, or they might counter your offer at close to their asking price. As far as the sellers are concerned, your original offer wasn’t a “real” offer.
   
   But suppose you offer to pay cash. Do you think the sellers would take your $250,000 offer seriously? Of course they would; after all, money talks.
   
   If you already have full loan approval from a lender (not just pre-qualification or pre-approval), and you have a letter from the underwriter to prove it, it’s as good as cash in the bank. You never know, maybe the seller will accept your offer rather than let a good buyer get away. If so, you save $25,000 on the purchase of the home, and all you had to do was meet with the lender before you went house hunting.
   
   For more information on full loan approval before you buy, call me at (435) 619-1377.
   
   
3. Buying too much house for your income.
   I used to provide “broker price opinions” (or BPOs) to banks. A bank would contact me to determine the value of a home the bank had given a loan on. Often, the BPO was needed because the homeowner could not afford the mortgage payments and was losing or had lost the home.
   
   Because life rarely works out the way you expect, be conservative when you shop for a home. Don’t unknowingly open the door to future foreclosure and bankruptcy by getting a mortgage that you can “grow into.”
   
   One of the best moves I’ve ever made was purchasing my current home. When I bought it, I qualified for a home twice as expensive. But, because I chose to be conservative, my mortgage payments rarely cause me stress or concern.
   
   
4. Thinking for the short term.
   Want to really scare me? Tell me you want to buy a St. George home today and will want to sell it in two, three, or four years. Yikes! Talk about wanting to lose money.
   
   Real estate home values generally rise very slowly in a slow or soft real estate market. In St. George, the average time between hot markets (when home values rise quickly, usually doubling) is 10 years. If you buy a $250,000 home in a slow market, in three years it might be worth $265,000. Your cost to sell with commission and other charges would be $18,200, and you would lose $8,200 for your short-term thinking.
   
   If you must move within three years of buying a home, it might be wise to use the home as a rental property for a few years, and sell it when the market will allow you to make a profit. Better yet, rent it out until the top of the next hot market, then sell it and potentially make a huge profit after expenses.
   
   
5. Using 1031 exchange money to buy personal property.
   Do you really want to risk having the IRS charge you with fraud? Enough said.
   
   
6. Not choosing an agent carefully.
   Did you know that currently about 75 percent of all St. George real estate agents have been in the business less than one year? So, when you contact a local agent, you have one chance in four of reaching someone who is qualified to represent you in making a $150,000+ investment…your home. You’ll want to contact at least four agents to make sure you are getting the best representation you can find. Ask questions and then trust your instincts as to which agent is best for you.
   
   
7. Not getting a professional home inspection.
   A good, experienced home inspector will catch problems with a home that most buyers would miss.
   
   I have seen all of these items missed by a homebuyer, but caught by a home inspector:
• A dryer vent venting into the attic
• A ground fault interrupt breaker not working (this can kill you!)
• Evidence of termites
• Aluminum wiring
• Roof leaking into the attic, but not into the main part of the home (yet!)
  

Lesson learned: Always get a home warranty when you buy a new home, even if you have to pay for it yourself. It is money well spent. I would never buy a home without purchasing a home warranty, and I would never sell my own properties without a warranty for the buyer. It just makes good sense

9. Not meeting the neighbors before you make an offer.
Don’t you hate it when you have really awful neighbors? You may be able to avoid moving into a truly undesirable property if you do a little door knocking before you buy your new home. This can help you meet neighborhood residents and get a feel for the community. It is also wise to check crime statistics (theft, vandalism, assault) and the state’s website for registered sex offenders before you decide to move into a neighborhood.

A case in point: I did a little door knocking before I bought a foreclosed home in St. George. I was buying the home for my personal use and as part of my due diligence process, I decide to meet the neighbors. I asked which house was the “bad house” on the street. Most of the neighbors said it was the home I was buying because the previous owners were noisy, rude, dirty, and didn’t maintain their property. I changed that by buying the home, moving into it, and maintaining it.