The excitement of buying a new home, generally makes people commit mistakes, especially if the buyer is purchasing the house for the first time. Even if you have done enough research about the property market, there are certain mistakes that you can commit.
Here we are with the five common mistakes that most of the people commit and need to avoid while buying a home for the first time.
- Not Getting Pre-approval –
Many first-time home buyers visit to see the properties before meeting mortgage broker or lender to talk regarding a home loan. In property market, competition is too high and housing inventory is tight, so it is very important that one should get prepared before stepping into the market.
If you don’t want your dream home to stay in dreams only, then make sure to get mortgage pre-approval. When you are pre-approved, it gives the seller a thought that you are serious about buying a property and you are eligible to get a loan. The mortgage pre-approval process will also let you know what you can afford. Like this, your time will not be wasted in visiting and viewing the properties that are not in your budget.
- Not Moving Around in the Market –
Many buyers just rely on their banks and lenders only and end up losing thousands of dollars. The more you will look around and talk to the people in the property market, the more you will get to know about the financial options available. You can then make comparisons to get the best deal in your budget.
A mortgage broker can study your current condition, can move around with you on your behalf in the market, and can make you available with suitable financial choices. They can even help you in knowing the home buying process in a better way.
- Not considering your budget –
Buying a home that you cannot afford now can put you in debt issues later. You can even lose your home if you are unable to repay the mortgage. Stretching the budget a little bit might sound tempting, but increased interest rates and unwanted expenses can put you in a tensed situation.
The best way is to calculate your budget by considering your basic monthly expenses so that you can easily pay the instalment of home loan.
- Ignoring Credit –
Don’t ignore your debts and pay attention to the outstanding debts. Cleat them as soon as possible as most of the lenders focus on credit reports. Ensure to have a good credit score before applying for pre-approval. Don’t go for loans on large purchases such as car and pay all your bills to get your application approved.
- Ignoring Additional Costs –
Be a smart buyer and have a clear vision of additional expenses that you have to face while buying home. This includes homeowners insurance, lenders mortgage insurance and repair, and maintenance cost.