5 First Time Home Buyer Mistakes To Avoid – As a first time home buyer, it is important to avoid mistakes when buying a home that could lead to problems. Here are 5 first time home buyer mistakes that you should avoid.
1. Looking for a home first and a loan later
Buying a home often starts with prequalifying for a mortgage, then starting the search for the perfect house. This should not be done the other way around. Being preapproved for a mortgage loan will help buyers with understanding and knowing your budget and will help aid in making a sound financial decision. Sometimes, finding the home first and then going into the mortgage application can cause emotional agitation if the approval is out of the price range of the house. This is especially true if there is already an emotional attachment to the house. Get pre approved and then find your perfect house.
2. Not getting professional help
After prequalification for a mortgage, it will be time to set out and find the perfect house. Your probably wondering where you should start? With professional help a real estate agent can help you. Real estate agents have total access to the Multiple Listing Service (MLS), and are a wealth of knowledge about the housing market. And real estate agents know the ins and outs of purchasing and selling a home.
In addition to enlisting a real estate agent, a buyer will want to use professionals when it comes to the mortgage and lenders. This is especially true when they are advising a buyer about one of the biggest purchases someone can make.
3. Getting new loans before deal is closed
A new home buyer just went in contract on their dream house, now it’s time to fill the house with new furniture but they should think twice before putting that amazing new couch on credit just yet. Lenders typically pull credit reports right before closing to make sure that the financial situation has not changed. Having new credit lines on your credit history could potentially hinder the closing. Just to be safe, wait until the deal is closed then go buy that spectacular couch on credit.
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4. Skip the home inspection
Buying a new home can be an expensive purchase and buyers want to save money when they can, but skipping on the home inspection could be costly in the long run. Home inspectors typically look for abnormalities in basements, attics, and mechanical rooms as well as other surface areas of the house inside and outside. This can potentially save the buyer from costly repairs well after closing. Spending the few hundred bucks is well advised in the investment of the new house so don’t skip out!
5. Forgetting about the hidden costs
Often times first time home buyers forget about the extra costs when buying a home. For example, taxes, homeowner’s insurance, utilities, closing costs, etc. Just make sure that you consider these costs and speak with a lender and/or realtor to find out more information and to make sure there are no forgotten costs.