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How to Avoid 10 Worst Home Buying Errors : Strategy: Even in a ‘buyer’s market’ it pays to use good sense when negotiating for the purchase of a house.

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<i> Bruss is a syndicated real estate columnist. </i>

You want to buy a home. In the current “buyer’s market,” purchasing a home should be simple, you figure. But it isn’t difficult to make a costly mistake in your rush. To minimize your chances of making an expensive error, here are the 10 worst home-buying mistakes to avoid.

1--Be in a hurry to buy a home. Corporate job transfers moving to a new city are considered by real estate agents to be the best buyers because they usually have only a short time to acquire a new residence. By rushing to buy a home after just a brief visit or two to a new community, these people often buy in bad school districts, overpay and neglect to have the house thoroughly inspected or check out the neighborhood carefully.

2--Buy a red-ribbon deal. If you want to pay top dollar for a home, buy one in perfect condition so all you have to do is turn the key in the door. That’s the way to sell a home, but not to buy one.

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Instead, look for a home needing minor cosmetic improvements such as painting, cleaning, repairing and landscaping. Shrewd buyers discount the price by more than the cost of the renovations, thus making their first profit at the time of purchase. However, stay away from homes needing such expensive major work as foundation repairs, new plumbing and new roof, because these improvements usually don’t add a great deal of value to the home.

3--Over-inspect the home before getting your offer accepted. Many home buyers develop “the paralysis of analysis.” That means they over-inspect the home before making a written purchase offer that the seller can accept. By the time they are ready to buy, someone else has made an offer.

If you are unsure about the home’s condition, just include a contingency clause in your purchase bid, such as, “This offer contingent upon a satisfactory professional inspection by a licensed contractor.” Should the inspection reveal unexpected defects, you can then either cancel the purchase or negotiate a lower purchase price.

4--Forget the best source of home-mortgage financing. Most home buyers and their real estate agents think there is only one basic way to finance a home purchase, with a 10% to 20% cash down payment and an 80% or 90% mortgage. But there are many other methods.

The best source of home-mortgage financing is the home seller. If the home is owned free and clear, don’t hesitate to ask the seller to carry back the first mortgage at a fair interest rate, such as 9% or 10%. The big advantage is you won’t have any loan fee to pay. More important, you won’t have to meet the often unreasonable rules for obtaining a mortgage from a bank or S&L.; Another easy finance method is to assume an existing assumable mortgage, such as a VA, FHA or ARM, with the seller carrying back a second mortgage.

5--Offer too much for your new home. The biggest mistake most home buyers make, especially first-timers, is making too big an offer. Remember, you can always come up in price, but you can’t come down. One of the worst feelings home buyers can have comes when their first offer is accepted. That usually means they offered too much. Don’t be afraid to negotiate hard.

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To be certain you aren’t over-offering, ask the real estate agent to prepare a written comparative market analysis before making your offer. This form will show you the recent sales prices for similar neighborhood homes, as well as the asking prices of comparable nearby homes currently for sale. Then you can add or subtract value for the pros and cons of the home you are offering to buy.

6--Get into a price bidding competition. A closely related mistake is to enter a bidding competition with another buyer. If you learn that someone else is offering to buy the same home you want, back off. The only winner will be the seller, because one of you will overpay.

7--Fall in love with a home. Many buyers become emotionally involved with a home to the point of heartbreak if they can’t buy it. No matter how much you love a home, don’t let the real estate agent and seller know. If you do, you can be sure the seller will hold out for top dollar. The old negotiation tactic “He who cares least wins” should become your motto.

8--Buy a home with a major incurable defect. Although a home may seem like a bargain, a major drawback that cannot be corrected will hold down the value of that home and make it difficult to sell when you are ready to move up. Examples of incurable defects include bad floor plan, noisy location, poor-quality school district and a busy street.

9--Buy an overpriced, brand-new home. New houses are usually priced substantially above nearby comparable older homes. The reason is that buyers will pay more for a new home because they think it won’t need repairs for many years.

But be careful, especially when buying one of the first homes in a new subdivision where the builder may have artificially inflated the prices. Check comparable new home prices in nearby subdivisions before your purchase.

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10--Forget the expense of maintaining your home. Don’t forget to budget for upkeep. The property taxes, water, electricity, heating, cooling and fire insurance bills are the major expenses to consider. If you can keep your total monthly housing cost including mortgage payment below 40% of your family’s gross income, you should be able to afford the home you want. Most buyers have to stretch their budgets by cutting out nonessentials, but as the years go by, your housing costs will weigh more lightly as your income increases.

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