Buying a home is one of the most significant financial decisions you will make. Here’s how to you know are taking the proper steps to get results.
9 first-time home buyer mistakes to avoid:
Look at All Your Home Options
Consider single family homes, duplexes, condos, townhomes and PUD’s. What areas are increasing in value, safety, the work commute, schools, libraries, fitness, coffee shops, does it have and HOA and more? Have you been pre-approved by Par 4 Mortgage? This will help you narrow your search.
The Right Real Estate Agent
There are plenty of things that can go wrong when buying real estate. Real estate agents help smooth the home buying process by providing extra insight into the market. They negotiate on your behalf and help you find the local services you need, like appraisers, home inspectors, insurance agents and even movers. They have built-in relationships with service providers. Par 4 Mortgage can recommend an licensed agent to help you search.
Pay What the Home is Worth
The housing market is notorious for its unpredictability, making it difficult to determine precisely how much a house should sell for. It’s important not to get swept up in the excitement of owning a new home, as it could lead to poor decisions. It’s also important not to let emotions interfere with sound financial decisions. If the seller won’t come down, maybe it’s time to walk away. Don’t start upside down, paying appraisal gaps right out of the gate.
When deciding on a home worth, you must also consider any additional fees such as maintenance costs and homeowners’ association fees. These costs vary from neighborhood to neighborhood and from property to property, so be sure you know what they will be before making an offer on any property.
What is The Resale Value
For some, the house will be a short-term investment, and for others, long-term. As it’s vital to purchase a home suitable to your needs, lifestyle and budget, resale can be critical, especially if you are buying to live in it for a short term.
Location, location, location. If possible, choose an area with good schools and low crime rates. These factors will help boost resale value when it comes time for you to sell your house later down the road.
Should I Buy a Fixer-Upper?
One of the biggest first-time homebuyer mistakes is buying a fixer upper. You might think it’s a good idea because you can save money on the purchase price, but if you’re not handy with tools and don’t have the time or money to do the repairs yourself, you could end up spending more than you would have on a move-in ready home. Not only can the cost get out of hand, but your stress level can also skyrocket.
Never Skip the Home Inspection
If you’re buying a pre-owned home, hire a qualified home inspector who will check for structural problems and determine if any significant issues need immediate attention. If you have hired a real estate agent, they can recommend one. If not, check the company and their reviews before hiring them.
Ask For Closing Assistance
It might seem like an obvious step, but many first-time buyers don’t ask sellers for closing cost assistance. While it varies by state, sellers can reimburse buyers for closing costs and other expenses associated with the sale of their home. Unfortunately, closing costs can add up — and they tend to be higher if you’re buying a house with a down payment of less than 20%.
This is especially true if you’re buying in an area with a lot of competition among buyers because inventory levels are low. If you don’t ask for help with closing costs, you’ll pay them out of pocket or use your savings. Either way, that money could have gone toward other expenses related to buying your new home (such as moving expenses) or even down payments on additional properties in the future.
Consider The Down Payment Options
Some home buyers have families that can assist them in the down payment needed if you do not have any help, it is essential to speak with a reputable mortgage lender to see all your home buying loan options. They can discuss your situation, including home equity, how to increase it and more.
Get Pre-Approved by a Mortgage Lender
This one is easy to overlook but getting started on the right foot in search of your new home is crucial. Discuss your financial situation with your mortgage lender, as they may also need financial documents.
Getting approved before your search helps you navigate the market within your budget smoothly. You do not want to find the perfect home and fall in love with it, only to find you cannot get a loan due to your income, credit score and current financial obligations.
A preapproval letter from a mortgage lender shows a buyer’s ability to qualify for a mortgage based on their current financial situation and credit score. It helps buyers avoid wasting time looking at homes they can’t afford because they don’t have enough money or good enough credit to get approved for financing.
In Conclusion, 9 First-Time Home Buyer Mistakes to Avoid
As a first-time home buyer, you get to start fresh and create your own new space. But it’s also a significant financial decision that requires careful planning and research. By sticking to these nine top tips, you can avoid mistakes many first-time home buyers make.
Are you a first-time home buyer and need help? Let’s get you started on the right track. Contact Par 4 Mortgage to learn more about your loan options.