1. Failing to budget the whole process
Buying a home is a serious financial endeavor and you should be prepared for it in advance. First, you should have saved enough money for a down payment. Before rushing to look for a home, you should be pre-approved for a loan. There is no point into looking for homes that you think you can afford. You know, what you think you can afford and what the bank thinks that you can afford are not same thing. And, to be approved for a mortgage, you need to prove that you will be able to make your payments. Lenders will be interested in your credit history, so dispute all payments. The higher your credit score is, the better the chances for approval are.
2. Not researching the market
If you’re eager to buy a home right now just because of your financial situation or you restrict yourself to a specific location, you may not see the forest for the trees. The housing market is a dynamic one. Sometimes it favors buyers, while other times it favors sellers. These fluctuations happen due to factors, like supply and demand, interest rates, consumer confidence and the overall condition of the economy. So, you should wait for the market to shift towards a buyer’s market. However, don’t be tempted to wait for the prices to fall for too long, as the situation may change fast and the prices to rise rapidly.
3. Not using the services a real pro
Choose a buyer’s agent who knows the market of your future neighborhood. They will have an insight on home prices and the quality of the properties offered on the market. A real pro can facilitate the home-buying process and protect you from making a choice that you will later regret. A good professional will educate you on the current market conditions and will help you handle the ins and outs of the negotiation process, including the preparation of all the necessary forms when making an offer. They will protect your interests and advise you during the entire process.
4. Neglecting the inspection part
You may be tempted to skip the inspection process in order to save money through forgoing the inspector’s fee, but don’t even think about it. It takes a trained eye to be able to see the problems that exist in a particular property. Inspection fees start at $450, more or less, and vary depending on the size of the home and how it was built. However, disregarding some defects may lead to damages estimating thousands of dollars. Hiring a good inspector can save you a lot of trouble in the future.
5. Letting emotions interfere
Do not fall in love with the “dream house”. It could be the worst financial decision you have ever made. Of course, you should put everything you can think of on your wish list, but you should also be aware of the fact that you may have to make some compromises. As a first-time home buyer, you may have to sacrifice something if your funds are limited. You may have to live on a noisy street, accept old-fashioned decor, make some minor repairs to the home, or let that extra bedroom go.