First-Time Home Buyer Mistakes

Each of us has all bought something from an impulse buy. We buy it because we wanted it then, in that moment, and later regret it. From the trucker hat in the gas station, to the barely played guitar that sits in the corner of our room; these items all make us question why we bought it in the first place. None of these are life changers though, but what if one was? What if you bought something that could change your life if you couldn’t afford it? This often happens with first-time home buyers.  The process can be daunting and confusing, but having your agent in your corner will make this process no problem. The best thing you can do is to protect yourself from first-time buying mistakes.

Getting emotionally attached

Buying the most expensive item you probably have ever bought will come with some emotional attachment, but don’t let it become too prevalent. If you lose a house for whatever reason, you could spend a while mourning about the house you lost. Do yourself a favor and remember, it’s just a house, it doesn’t love you back.

Finding the home yourself

Yes you can look around all you want, but let you agent do most of the work. They know what you’re looking for (hopefully), and can even find homes that haven’t even been put on the market yet. Make them earn their dollar, because they are the professionals again not you.

Go directly to the listing agent

Do NOT go directly to the listing agent yourself. This is highly frowned upon, unless you know them personally, or have worked with the before. Your agent should go to the agent before you do, so let them.

Assuming the rules don’t apply to you

One of the best parts of owning your own home is, you are free from the parent’s rules, or landlords. But there are still some rules that will apply to you. These are usually found within the deed restrictions. Deed restrictions are there to ensure the property will hold its value under your care. If you plan on trying to skirt these plans and do your own thing, you could have a problem on your hands. Once you get the deed and its restrictions, read it carefully so you know where your boundaries are.

Not saving enough cash

You should have enough money for your down payment, and then some. One you slap down that big wad of cash, you should also have three months of mortgage payments saved up in case you hit tough times. Don’t forget to have enough cash for closing costs (2% to 5% of homes value) and property taxes.  Once you’ve moved in, you’ll need appliances and things you’ve never even given a thought.  Have enough money for all that, and then an emergency net of six months of expenses.

Not being preapproved for a loan

If you want to be taken seriously for your bid on a home you must show proof of income and assets in the form of a preapproval letter from a lender. Without this, it tells the seller, the lender isn’t comfortable with lending you a certain amount of cash.

Paying private mortgage insurance

If you put down less than 20% you will have to pay for PMI. This isn’t uncommon for first-time home buyers, but let your lender know you have paid your mortgage down to 80% and they will cancel your PMI.

Ignoring the price of homeowners insurance

If you buy a home, you better ask yourself if you can afford the insurance that goes along with it. Obviously you could get a home that has little need for insurance, but other homes have greater need. Homes on a river, on a fault line, in tornado alley, all have pretty high insurance costs. Be sure you can afford what you buy.

Not checking your credit score

Believe it or not, there are a ton of credit checks that have errors in them. There are even errors as small as the misspelling of your street can, they can impact you. Some errors can severely hurt your score.  Check your credit report three months prior to house hunting, and you’ll have plenty of time to fix anything if it comes up.

Skipping the home inspection

Every home needs an inspection, even the one that has never been lived in. Some buyers are dumb enough to skip this step because they want it so bad, they don’t care what’s wrong with it. Isn’t it best to have to seller to fix what problems there are to get you a better price?

Don’t be shy to ask for thigs if you are a first-time home buyer. The people who ask for more get more. The worst they can say is no. Don’t be afraid to ask for what you want. 

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