15 Reasons to Walk Away From a Home Purchase

If you're looking at houses to buy, you should look beyond the layout and whether it has a nice kitchen. You need to make sure you're making a sound financial choice and investing in a property you'll enjoy for years to come.

To avoid ending up in a home you regret purchasing, you should be on the lookout for these 15 reasons to walk away.

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If you're looking at a home and the total costs would exceed around 25% to 30% of your take-home pay, it's a good idea to skip that property and find something more affordable.

If your housing expenses take up too much of your monthly earnings, you could be considered "house poor." Other financial priorities, from furnishing the property to saving for retirement, might have to be pushed to the back burner as you struggle to keep up with mortgage payments and other essentials.

It's also important not to get caught up in a bidding war that would put you over your budget -- sometimes, it's too easy to get caught up in the excitement of a house you love and lose sight of your limits.

ALSO READ: How Much House Can I Afford?

Whether you're a parent or not, if you discover that a home you're interested in is located in a poorly rated school district, you may want to walk away without making an offer.

A good school district is a top priority for people with kids in most situations. If you can't offer a good one when it comes time to sell, you'll have a smaller pool of potential buyers and can expect to get less money for the home.

You'll want to check the drive time and route from any home you're thinking about buying to your work and to other places you often go, such as a relative's home or your child's school.

If your daily drive would be miserable, steer clear of the property, or your commute will stress you out every day for years to come.

ALSO READ: 3 Really Bad Reasons to Buy a House

Buying a home that's worth more than others around it could be a big mistake.

Most people won't pay a premium for the best home in the neighborhood, especially if it doesn't fit in with its surroundings and other nearby properties have a lower value.

Instead, if you can, you should try to do the reverse and buy the cheapest home in the best neighborhood you can afford since you can't ever change the property's location.

If you discover that home upgrades were done with no permit, you should immediately walk away from the house.

If the unpermitted work is discovered after you've bought it, you could face a host of serious financial consequences, including an increase in property taxes along with the costs of getting the permits, bringing the property up to code, or tearing out renovations that weren't allowed.

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When you decide to make an offer on a home, you'll likely want to make your purchase contingent on securing financing at or below a set rate.

If it turns out that you can't get a home loan at a reasonable interest rate, you need to be able to walk away from the purchase without losing your deposit.

ALSO READ: 4 Tips to Simplify the Process of Getting a Mortgage

Mortgage lenders will want you to get an appraisal to make sure the home is worth enough to guarantee your home loan.

If a house you've made an offer on doesn't appraise for enough, your financing could fall through, or you might have to put more money down.

Including an appraisal contingency in your offer can help ensure you can walk away from the sale -- or renegotiate the price -- if this happens to you.

You'll also want to make any offer on a home you are interested in contingent on a property inspection by a professional of your choosing. If it turns out there are huge issues, such as an unstable foundation or problems with the electrical work, this may be grounds to walk away.

If you didn't know about the issues up front and the house isn't priced low enough to be worth it after repair costs are tacked onto your total costs, you'll be glad you found out before signing the paperwork.

ALSO READ: Here's Why You Should Always Get a Home Inspection

If problems do turn up in the inspection, you may be able to avoid walking away from the home purchase if the sellers are willing to either repair the problems or give you credit.

If sellers are unwilling to budge, though, and you don't want to deal with the expense or hassle associated with problems that have arisen, it may make sense for you just to find a different property to buy.

When you make an offer and move toward closing, you'll need a professional to perform a title search to make sure there are no liens or competing claims on the property and to confirm that ownership is clear.

If the title company reveals problems, you may not be able to get a mortgage. And even if you could borrow to do so, you may not want to go ahead with the purchase if the ownership is disputed or there are outstanding liens that would have to be paid and won't be addressed before you close.

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You'll likely also want to make any offer to buy a property contingent on a land survey. If the survey turns up issues, such as a dispute over the boundary or an easement that gives neighbors access to a large part of your land, this may be reason to think twice about going ahead with the home purchase.

ALSO READ: What Is a Land Survey, and When Do You Need One?

If you are buying into a home with a homeowners association (HOA), be sure the current owners provide a copy of any rules and restrictions. Some HOAs have very strict rules and impose fines for violating them.

If you can't live with these requirements, walk away from the purchase before you get stuck with violations that cost you or find yourself constantly in disputes with your neighbors.

Property taxes sometimes cost as much as a mortgage. Find out what the tax rates are in the area you're looking at and get an estimate of how much you can expect to pay each year if you buy the home.

If the taxes would put your total housing costs over budget, walk away and look for a different property.

ALSO READ: My Property Tax Bill Could Skyrocket Next Year. Here's How I'm Preparing

You will have to pay closing costs on any real estate purchase. These can include mortgage origination fees, transfer taxes, up-front association fees, pro-rated property taxes, and more.

Closing costs can vary from one property to another. If a particular home comes with tons of up-front costs you can't afford, don't move forward with trying to buy it.

Finally, be sure you understand zoning restrictions and find out whether there are any special rules in place for parts of your land.

If a portion of your land is on wetlands or is considered conservation property, or if your home is in a historic district, you may face severe restrictions on land use or changes you can make.

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Finding a home you love may be exciting, but if it's not the right property for you, it's best to discover that early. Be sure you're ready to walk away before making an offer if the home is too expensive or doesn't meet other key criteria, such as a quick commute.

And if you do make an offer, be sure to include the appropriate contingencies so that if problems arise later in the transaction, you are not locked into purchasing a home that's not really right for you.

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