3 Problems That Could Impact Your Upcoming Real Estate Sale

So, you are finally ready to move out of your parent's house and get a place of your own. You know it's not easy finding and financing your own home. However, you don't know exactly what problems you may run into along the way. Here are three of them that could potentially cause your sale to go amiss:

1. Stricter Policies on Lending

At the start of 2014, the Lending Act was amended so that your monthly debt could not exceed 43 percent of your income each month. If it does, it is going to be hard to qualify for a mortgage loan. The financial part of the process can literally make or break the sale. A significant portion of applications for mortgages are rejected due to the fact that these new policies keep prospective buyers from being eligible. To help combat this from being an issue in your situation, you can get preapproved with a lender prior to making a bid on a home. This will speed the sale up if you're approved, but you can still be denied.

2. Lower Appraisal Values

While the home that you are looking at may have already been appraised, the lender will want to have it appraised again. This is simply to ensure that the most accurate price is being quoted on the home. After all, if your home were to be foreclosed on in the future, the lender wants to ensure that the loan amount doesn't exceed the fair market value of the property value. In addition, the appraisal value will be used to get your mortgage loan. If it is below what is being asked for by the seller, you may not get as much from the bank. In this instance, Investopedia says that a lower appraisal value will demand that you (the buyer) pay the difference or that the seller adjusts the selling price. If neither agrees, then the lender will not approve the loan. Another option would be to back out of your offer and look for a more feasible property that you wouldn't be overpaying on.

3. Home Inspections

While all lenders will not require a home inspection, it really doesn't hurt for you to have one performed before you close on a home. A licensed home inspector will examine the home's electrical and plumbing systems, analyze the property's structural integrity and more. Unfortunately, this could reveal a cracked foundation, damaged roof, pest infestations, etc. – all of which could potentially result in very extensive and costly repairs and further negotiations with the seller on price. It may even be enough to make you withdraw your offer completely. Prior to putting a house up for sale, a seller should have an inspection done on a home to find these problems themselves so that they can be addressed ahead of time. Some sellers may then choose to list the damage with the listing, pay for the repairs or sell the home as-is, while others will try to hide the problems if they know they existed.

Ultimately, it is important to know that no real estate sale is guaranteed once an offer is made. Problems can also crop up at any stage of the process, and the aforementioned three issues are just some of the obstacles that you may face with your own sale. To minimize complications in your own real estate transaction, make sure to have a professional real estate agent by your side.