Homebuyer's Remorse: How to Avoid and Cure
You could be suffering from buyer's remorse, that nagging feeling that perhaps you made a mistake, got in over your head, or for some reason shouldn't have bought that home after all.
The feeling is not uncommon. Experts say that 5% to 10% of all homebuyers -- and maybe more--regret their home purchase.And since a record 41% of U.S. home buyers are now first-timers who've never owned property before, according to the National Association of Home Builders, the potential for buyer's remorse has never been higher.
To keep you feeling confident about your home purchase, AOL Real Estate asked three housing experts for advice. Here are their tips for preventing real estate buyer's remorse, along with some advice about what to do if you come down with a case of it.
1. Stay focused on the long view
According to real estate attorney Corliss Franklin, a solo practitioner in Plainfield, N.J. with 20 years experience, it's normal to have some second thoughts about buying a house, considering it's likely the biggest financial purchase of your life.
"I generally see the nervousness manifesting itself at the very beginning, when the buyer is focusing on the cost of the home," Franklin says. "People think, 'I'm going into debt for $300,000,' and they sometimes fret over that huge financial commitment."
The trick, says Franklin, is to stay focused on the long view. Even when people get cold feet at the closing table, she says, most buyers get over it by reminding themselves that "they're fulfilling their dream of getting a home."
Once you've closed on a home purchase, there's virtually no way to get out of it, says Jim Randel, a Westport, Conn.-based real estate attorney and author of books including "The Skinny on the Housing Crisis" and "The Skinny on Real Estate Investing." So make sure you get all of your questions about the property answered to your satisfaction up front.
Another area where you may have some recourse is the issue of "psychological impact." Sometimes, "a person feels they got defrauded if they weren't told that there was a murder or a serious crime committed in a house and they bought the property," Randel says. That's the case right now for Anthony and Rita Bucklew, who unknowingly bought the former rental home of a serial killer in Colorado and now want out.
Short of these scenarios, however, you won't be able to undo a deal -– no matter how much buyer's remorse you experience. "It's going to be extremely difficult to cancel a transaction and come out of it unscathed," Franklin says. She notes that reneging on a real estate deal after you've signed a contract to buy the property could mean losing an earnest money deposit or facing the threat of a lawsuit from the other party.
3. Do a walk-through and prepare for closing
You can help avoid jitters at settlement by doing a final walk-through of the house to inspect it one last time before your closing date. Arrange this walk-through after the seller has moved out, so that you can view the home, make sure everything is in order, and be 100 percent confident in your purchase.
Another way to avoid buyer's remorse -- and unnecessary stress -- on the day of settlement is to know what's coming at the closing and to be prepared for the unexpected. For example, you should know the players who will be present at closing. Will the sellers attend the settlement or just their attorneys? Also, will you have a lawyer present, or only your real estate agent? Your agent's job is to make sure that no surprises end up short-changing you in this whole transaction. Your agent will also negotiate on your behalf if any issues arise with the seller.
Representatives from a title company might also be in attendance. They're present because sometime earlier in the process a review of the seller's title was done to make sure there were no impediments to that person's selling you the home. Additionally, that individual, or someone from the title company, might have reviewed the title search, prepared a title insurance policy or conducted other title-related services.
4. Factor-in ongoing expenses
Sometimes buyer's remorse doesn't kick in until weeks or months after the purchase, when the new homeowner has a financial awakening about the costs of living in the property. "Some people get don't get buyer's remorse until they've moved in and they get those first utility bills," says Rodney Anderson, a Plano, Texas mortgage banker with Supreme Lending and the author of "Credit 911."
Others regret their home purchase after they've moved to suburbs or far away from their jobs. "All of a sudden, the commute to work costs an extra $5 a day. Or they have to drive further to get to church or take their kids to football practice," Anderson says. "It can all really add up, especially when gas prices rise."
For some homeowners, homebuyer's remorse kicks in once they realize that their property taxes keep increasing -- sometimes dramatically -- year after year. "All these things are budget-busters that can cause buyer's remorse," says Anderson.
Your best defense here is to think realistically about the true cost of homeownership so you know what to expect before you sign on the dotted line. "Most real estate transactions really do go smoothly," says Franklin, the Plainfield attorney. "It's the anomaly where you have an individual, either buyer or seller, who wants to back out of the deal."
Closing on a new home? Make sure the process goes smoothly with the help of these AOL Real Estate guides:
- The Hidden Costs in Home Buying
- Guide to Settlement and Escrow
- Closing Costs: No Surprises
- Guide to New-Home Warranties
More on AOL Real Estate:
Find out how to calculate mortgage payments.
Find homes for sale in your area.
Find foreclosures in your area.
Get property tax help from our experts.