Credit 911: Secrets and Strategies to Saving Your Financial Life

CHAPTER 7

Buying Real Estate Is Not a Joke

Do you need to qualify your expert? You have heard the old adage, “If it sounds too good to be true, it probably is.” Many a parent has drilled this into the heads of their children in the hopes that it would repeat in their heads forever as they moved into adulthood. I’ve used it myself when consulting with potential homebuyers about financing options. In order to illustrate how incredibly important it is to interview and qualify your lender, realtor, or builder, I want to tell you a story about a terrible injustice that occurred right near my own hometown of Dallas, Texas.

A well-known semi-custom builder began constructing very nice homes in the area—nice enough to attract a wide array of potential homeowners from all different backgrounds. The majority of these people were not financial experts, and many had not obtained prequalification from a lender beforehand. When visiting the model home, they were greeted by friendly sales people and the smell of fresh-baked cookies. They were encouraged to walk through the beautifully decorated model, admiring the custom paint colors, floor-to-ceiling windows, and enough bedrooms and bathrooms to accommodate a large family. It felt like a dream to these families, most of which had never imagined owning such a luxurious home.

After the tour, the head of the family was encouraged to spend a few minutes talking with the salesperson about the possibility of owning a new home in this subdivision. ...