Real estate agents are about to enter the busy season, with temperatures warming across the country and buyers flocking to the housing market. This means that more people could be seeking the services of agents, which can create additional risk, as a simple misstep could lead to a client lawsuit. One of the most important things real estate professionals can do is help clients avoid missteps that could put their home purchase in jeopardy, which is why it is essential for all real estate firms to have a comprehensive Errors & Omissions insurance policy. Here are four of the most common occurrences that can damage a buyer’s purchase:
1. Failing to properly get a home inspected
When homebuyers find their dream house, they may want to move in quickly. But, real estate agents need to be sure an inspection is completed before any transaction is finalized. Failure to complete this step could result in a major issue being found down the road that could be costly to repair. If buyers claim their real estate agent didn’t recommend a thorough inspection, they might sue for the amount of the repair.
2. Failing to get pre-qualified for a mortgage
With buying a home being one of the biggest financial decisions of anyone’s lifetime, real estate agents need to be sure to provide good advice in this area. Many first-timers often make the mistake of not getting pre-qualified, which could prove troublesome when completing the buying process. Agents need to be sure to recommend this step, so people can have a better chance at successfully finding a home in a price range they can afford.
3. Not taking into account future homeowner expenses
During the buying process, agents should make people aware of all the expenses that come with being a homeowner. Not only are there costs associated with buying a property, but there are also additional expenses that arrive after moving in – property taxes, homeowner’s insurance and maintenance expenses. Without knowledge of these costs, people could find themselves in trouble after buying, which could lead them to be disgruntled with their agent. It may be difficult for this type of lawsuit to be successful, but just being sued can be costly for a real estate professional.
4. Delaying a purchase for a better mortgage rate
Younger buyers may want to save every penny when purchasing a home, which is why these people could think it is a good idea to hold out for a more affordable interest rate. However, this could end up costing them, as the market is difficult to predict. It is probably best that real estate agents tell clients to avoid making this mistake, and not make it seem like a good idea. If agents advise this move, and it ends up costing a client money, they could sue for financial damages.
Real estate agents are responsible for ensuring a successful transaction for buyers, and avoiding the above mistakes is one of the best way to keep risk in check during the busy spring buying season.
For coverage to protect yourself as a real estate agent, broker or firm against Errors and Omissions claims, visit Norman-Spencer.com/TopTier.