Top 5 First Time Home Buyers Mistakes
Buying a home is a dream come true for many people. However, for those that are entering homeownership for the first time, it is easy to fall into some of the most common first time home buyer pitfalls. These mistakes can be not only financially taxing but also emotionally. We're revealing some of the most common first time home buyer mistakes to avoid in order to make buying your first home a smoother, easier experience.
1. Overspending
Everyone has a dream of what his or her first home will look
and feel like. But for some, that means compromising finances to make that a
reality. Emotions often get tied in the mix and lack of experience sometimes causes
first time home buyers to spend more than they can afford.
To avoid making this mistake, it’s crucial that you meet
with a mortgage lender to determine how much house you can afford and get a
pre-approval. Calculate a budget mortgage based on your current earnings, not
based on projected earnings in the future in case something happens.
2. Forgetting Extra Expenses
When you look at a listing online or in the property
brochures, what you see is the selling price of the home. What you don’t see is
the additional costs associated with the actual purchase of that home apart
from the listing price. These items include things like closing costs, property
taxes, homeowner’s insurance and HOA fees.
When you’re seriously considering purchasing a home, make
sure you account for these added expenses in the long run. You don't want to get blindsided when it comes to closing day.
3. Not Considering Resell
There are many factors outside of the actual, physical home
that home buyers should consider when purchasing one. The neighborhood,
schools districts, and accessibility, among other things, are all items that
should be considered before purchasing which affect resell value.
If you’re
like most first time home buyers, you
are going to start in a smaller home initially and want to move up when your
family, careers and needs change. Make sure that you take into account how easy
(or hard) it may be to resell down the road when you’re ready to make changes.
4. Foregoing Home Inspections
A home may look like the perfect place for you and your
family from the outside and maybe even when you browse through the inside of
the house. However, what might appear to be perfectly fine from the surface,
could be financial and emotional ticking time bomb.
Home inspections are meant to protect you from making a poor
investment and should be at the top of your list before signing the papers.
Don’t let your emotions get tied up in the mix and affect your decision, especially when the inspection comes back unfavorable.
5. Unrealistic Expectations
Because its their first home buying experience, buyers often fall into the “overly
optimistic” or “too critical” categories. For some, they think that they’ll be able to
put their DIY skills to work and fix any issue that comes up. Whereas, others
may not confide and trust their Realtor’s guidance and submit unrealistic low-balls
offers.
Work with a Realtor that’s been in the game for some time
that you can trust to guide you as to whether the homes you’re considering
would be a good fit for you. Be realistic about your home improvement skills
for fixer-uppers, and let your Realtor help you determine what is a fair purchase price.
Are you a first time home buyer? Download the First Time Home Buyer Guide for all the tips and tools you need to purchase your first home.
