Buying a house can be a daunting process, especially if it’s your first home. The task is exciting, of course, but it is also confusing and full of complexities, which can lead to mistakes and cause a lot of things to go wrong. A property is the largest purchase you’ll likely ever make, which means that it’s more important than ever that you are properly prepared and understand how to avoid the common mistakes that have slipped up far too many home-buyers in the past. With that in mind, here are ten major home buying mistakes and what you can to do prevent them.
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Top Home-Buying Mistakes You Need To Avoid
Buying Instead Of Renting
The biggest mistake you can make in the home buying process is choosing to buy in the first place. When you rent a home, it can be frustrating having to write a rent check each month knowing that you’re never going to have an asset to show for your investment. That being said, you shouldn’t jump into the property market for this reason alone. Home ownership can be more expensive and permanent than renting, so always consider your circumstances carefully.
Buying Without An Agent
With the internet and online property listings at your fingertips, it can be tempting to go it alone and try buying a house without the help of an estate agent. However, considering the amount of support an agent can offer, as well as the fact that this help is generally free, you should always have a realtor by your side when you start looking at homes. Make sure you meet with and interview a few estate agents to find the one that you trust and connect best with.
An agent can be really helpful if you are moving to another state. Let's just say you live in Wisconsin, like I do, and you are trying to search for lakefront homes in Tennessee. When you have an agent assisting you, they can tour the home for you with you on the phone as well as take a video of exactly what you want to have a closer look at or measure something for you to see if that king size bed will fit exactly where you were hoping it would. This can save you lots of money in travel expenses. Also, think of all the time it will save.
Hunting Beyond Your Budget
Before you start looking at homes, you need to sit down and figure out exactly how much you can afford to spend on one. Although the mortgage loan will cover most of the cost of the house, you’ll still need to make repayments each month that will vary depending on the home you purchase. It’s crucial that you only look at properties that you can actually make these payments on. If you don’t, you could end up falling for a house that you can’t afford and could end up losing. Most whole sale lenders have a pre-approval process which can help you to learn the maximum you could be approved to borrow. Then, you just need to remember to stay within your own budget.
If this is a long distance move to a new area or state, you will want to factor in the costs of getting to know the area and it's people. If your budget is too tight for extra expenses of maybe trying out the local restaurants or activities, you won't feel comfortable in your new neighborhood. For example, if you are Moving to South Carolina, it would be a good idea to see what activities there are to do and try to factor one into your budget every week or two. You could try a new restaurant one weekend, then check out the local zoo the next weekend.
Underestimating The True Cost
A huge mistake many first time home buyers make is assuming that their property loan will cover every cost involved in purchasing a house. Unfortunately, this isn’t the case. Additional expenses, like loan application fees, stamp duties, mortgage insurance, valuation costs, and more will all need to be handled by you. You’ll also need to consider the down-payment and costs involved in moving house. Make sure that you have enough cash saved up to cover all of these expenses.
Sabotaging Your Own Finances
For the best negotiation position, it’s vital that you have your mortgage loan pre-approved before you start property hunting. Unfortunately, being pre-approved for a loan doesn’t mean that you’ll always get one. If your financial situation changes, resulting in a bad credit score, you could be denied when it counts. For this reason, you should try to keep your circumstances the same and make sure you apply for any necessary credit before you go make your loan application.
Skipping The Home Inspection
Home inspections aren’t cheap, but the time, money, and stress they can save you are priceless. Many future homeowners skip a home inspection because they want to save money or don’t want anything to go wrong. However, without the inspection, neither of these reasons will likely occur. A home inspector is there to spot any potential problems that could cause trouble or cost money down the line. This may save you from a bad deal or help you negotiate a good one. Enlisting the help of professional inspectors in your area can be crucial to the process. Their in-depth knowledge of housing in the local area, wherever that may be, can be invaluable. For example, if you're out in Salt Lake City, you'll almost definitely want to get in touch with a home inspection service in Utah due to them being experts in your area.
Overestimating Your DIY Skills
When you’re buying a home that needs repairs, you need to be realistic about the work that you can and can’t do yourself. If you try to DIY something that you’re really not skilled enough to do, it will cost you money and time you can’t afford to waste. Fixer-uppers are appealing to first-time buyers, as they’re cheaper and the renovating process can seem fun. However, this is a lot of work, and unless you have a lot of experience in this area, it’s probably best that you avoid it.
Not Researching The Neighborhood
The house you’re viewing may be up to scratch, but that doesn't mean that the surrounding local area is. Location is just as important as the property itself, which means, before you make any commitments, you need to get to know the neighborhood too. You should find out about the crime level, transport, schools, jobs, and anything else you want to know. Having a great home won’t mean anything if you hate every bit of the town or city that it’s located it.
Letting Love Control You
The process of looking for a home for you to live is always going to be partially guided by your emotions and how you feel when you step foot in the houses you’re viewing. That being said, you should try to keep your feelings in check and avoid falling for any particular property. This way, you’ll be able to stay rational and walk away when you’re faced with a deal you don’t like. Always try to look at every home with an open mind and consider all of your options before deciding.
Buying Out Of Desperation
The house buying process can easily go on for months or even years, causing frustration to any and all future homeowners. This frustration can easily lead to desperation, which has driven a number of people to buy houses they don’t really want, just so that they can get everything over with. This is a huge mistake, as it leaves you with a property you don’t like and unnecessary debt. Instead of doing this, you should take a break and start looking again when you feel ready.
There are lots of issues you need to deal with when buying a house, especially for first-time buyers. That being said, with the advice above, you should be able to avoid and handle a few of the biggest ones.
This is a contributed post.
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Top Home-Buying Mistakes You Need To Avoid
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