It’s easy to get caught up in the excitement of buying a new home. This excitement can cause first time homeowners to make mistakes, that could lead to buyer’s remorse later on. Laid out below are some common mistakes made when buying a home for the first time, and some tips on how to avoid making them.
Looking for a home before applying for a mortgage.
Looking at a home before applying for a mortgage can be a big waste of time for first time home buyers. They can look at houses that are way out of their price range. A new home buyer can feel crushing disappointment when they realize that they can’t afford the house that they’ve fallen in love with.
Draining your savings.
One of the biggest mistakes a first time homeowner can make is using up all of their savings on a house. Monthly bills can add up and without enough money left over, they may have to live check to check. This could easily lead the homeowner to fall into a financial hole. It’s easier to just save up for a house and other expenses that may pop before jumping into buying a house.
Miscalculating the hidden costs of homeownership.
Many new homeowners don’t think about how much really goes into buying a house and there are several things that one must pay for. For example, property taxes, mortgage insurance, homeowners insurance, repairs, maintenance, etc. It’s a good idea to have a rainy day fund just in case. It’s also important to calculate monthly payments so that you don’t become overwhelmed by the payments.
Miscalculating repair and renovation costs.
This goes hand in hand with hidden costs of home ownership. First time homeowners can underestimate how much repairs can cost, especially when they buy a previously owned home. One of the biggest mistakes a new homeowner can make when getting repairs is not looking at estimates from other contractors. Another big mistake a homeowner can make is thinking that house repairs can be done quickly and easily.
Not doing a home inspection.
Home inspections are an essential part of the homebuying process, but first time homebuyers may think this is a step that they can skip. Often times new homeowners think that they can see if a home has problems just by glancing around, but they can’t. A professional inspector is more likely to catch problems. A home inspection can help with negotiations on the cost of the house, or make the current homeowner have to pay for the repairs. If you don’t have an inspection from the start, it can lead to more problems down the road, and that’s money that will come out of your pocket.
Focusing too much on the house and not looking at the neighborhood.
It is important for homeowners to know what they want from their house, but many don’t think about what they want from their neighborhood. A new homeowner may get everything they want out of their new house but end up in a neighborhood that they hate. Good questions to ask yourself when looking into a neighborhood are, is it close to your workplace? Is it near a grocery store? If you have children, or are planning on having children it could be important to note if you’re near a playground, or a school.
Not researching mortgage lenders.
Making sure you have the right mortgage lender is very important when buying a home. When looking into a mortgage lender you should be aware of what kind of mortgage that you want, as not all mortgages are made the same. It’s also important to compare loans from different lenders to make sure you’re getting the best deal. A homeowner must also make sure that they can completely trust their mortgage lender by researching the lender’s reputation.
First time home ownership can be overwhelming, and there are many steps to make. If you avoid making these mistakes, it can make your plan to buy a home go a little smoother.