The Mortgage Professor

Mistakes in Buying a House

Look for a house without knowing how much you can afford to pay.

Assume that the FHA will protect you from buying a house with major defects.

Assume that stretching your house-purchasing ability to the limit will maximize your wealth over the long term.

Purchase a house with someone not your spouse without a written agreement.

Assume that you must close on the sale of your existing house before you can close on your new house.

Shop for a mortgage that allows home purchasers to consolidate existing debts.

Buy a manufactured house through a dealer with a package that includes house, installation, site and financing.

Allow the purchaser of your existing house to assume responsibility for your existing mortgage without a release of liability.

Decide in advance that you will consolidate debts in a new purchase mortgage, then only price mortgages that allow it.

Borrow someone else's bank account to show you have the cash reserves needed to buy the house.

Buy a house under a lease-purchase contract that allows the seller to cancel the option to purchase for a trivial violation, such as a single late rent payment.

Finance settlement costs without considering whether it will raise the price of the mortgage.