Buying a house can be an overwhelming task for anyone at any point in life, but for first-time home buyers, it can be especially challenging. The mortgage process, house-hunting excursions, inspections and negotiations all contribute to a home purchase. Each stage of the process is associated with any number of pitfalls. Use the following tips so you can avoid making mistakes and a new home buyer.
Shopping for a House Before You’re Pre-Approved for a Mortgage
It’s much more exciting to visit a prospective new home than a bank, but it’s important to get the questions of funding settled first. Many new home buyers make the mistake of shopping for a house before they obtain pre-approval for a mortgage. This can set buyers up for disappointments. The lender will let the buyer know how much funding they qualify for. This information allows them to hunt for a home in their budget range.
Applying With Just One Lender
A new home buyer wouldn’t check out just one house before purchasing, so why apply with just one lender for pre-approval for a mortgage? It makes good fiscal sense to shop around for a lender. Real estate experts advise new home buyers to consult with at least three lenders before committing to one. Different lenders offer different rates and loan terms. Take your time to weigh each offer and choose the one that’s ideal for your situation.
Buying at the Top End of the Budget
Just because a bank is willing to lend buyers a large sum of money, doesn’t mean that buyers have to spend it all. First-time home buyers often fail to understand the maintenance costs associated with a new home. If all of their income is needed to pay their mortgage and other essential bills, they may not have much left over for emergencies like a failed appliance or a plumbing problem. Buyers need to make sure they buy a house with a comfortable mortgage payment.
Rushing the Process
Purchasing a house is a major decision. Some people are so excited to get into a new home, a home of their own, that they rush the process. It’s essential to take your time. Visit lots of homes. Compare and contrast them. Learn about the questions you need to ask about the home’s condition. A house is a huge investment, so you don’t want to sign a contract until you’re completely confident that you’re making the right choice.
Shopping for a House and Not a Neighborhood
Too often, first-time home buyers settle on the right house that happens to be in the wrong neighborhood. Always consider the surrounding area of a home. Crime, for instance, can affect home values. Buyers need to consider amenities, the quality of schools, city services and their commute. Is there convenient public transportation nearby? Are their parks and green spaces for running or walking the dog? The wrong neighborhood can lead to dissatisfaction with a purchase decision.
If you’re a first-time home buyer, be sure you consider this advice so you don’t make mistakes that can affect your life considerably. By avoiding these pitfalls, you can make the home-buying process more enjoyable and fulfilling.