Gone were the days when home ownership was a privilege limited to few. These days, people are snapping up properties like pancakes. What once took decades to research, plan, and save for can now be purchased without so much as a signature.
The real estate market in these modern days is hot. Not only is the demand for various properties on the rise but the available supply is also increasing quite rapidly. By the time potential homeowners decide on a property to purchase, a new development is rising in their area or a different location.
But given that the demand is continuous, and with the consumer market expanding to a much younger demographic, there is a certain degree of pressure that buyers face when deciding to buy a home. There is always the threat of the perfect home being swiped from underneath your fingertips all because it took you a few days longer to make an offer.
Although this is the current situation of the market, there is no reason for you to make a subject-free offer on the property just because you want to lock it in. Unless you do not require external financing, this won’t offer you any protection. This is because subject-free offers are free from any conditions.
Once the seller accepts your proposition, there is no way for you to back out of the deal. More often than not, people lose their deposits and end up paying for legal damages as a result of the inability to fully purchase the property as initially agreed upon.
Do remember that with the changes in the real estate market come changes in the way lenders behave. Employment is essential. Having your own business doesn’t guarantee you any approval. In this case, you might want to work with a reliable mortgage broker who can help you find the best financing option and work with you on applications and payments.
Don’t be confident just because you have been pre-approved by a lender. This does not guarantee anything. All it means is that your application has been assessed and considered. When you decide to purchase a property, the lender will assess it for its value and then make a decision on whether or not to grant you the loan and in what amount.
There have been plenty of cases when a borrower has been approved for a loan yet received no assistance because the lender did not see the property in question as a viable or worthy investment. Remember that if you fail to pay your mortgage, the lender gets ownership of the property. This is why they assess it for its value.
And just in case you make a subject-free offer and find out that there are issues with the property, the entire burden falls on your shoulders, as the seller is free from any obligation at this point. And when such issues arise, the lender will be all the more hesitant to grant your requested financing. So take your time and make sure that everything is in order before you decide to buy property in the same amount of time that it took you to order a cup of coffee.
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