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Wendy Gimpel

Ten Common Mistakes from First-Time Home Buyers

When people get ready to make one of life’s big decisions, purchasing their first home, they oftentimes don’t know what they’re doing and are likely to make mistakes. Here are ten of the most common mistakes by first-time home buyers, along with some tips to avoid them so you can have a smoother home-buying process.

Getting Mortgage Approval Late

You should get your mortgage approval before you look for homes. Otherwise, you won’t know how much you can afford, which can waste your time and lead to emotional rollercoasters you don’t need. The approval also looks good to home sellers who want to know how serious you are about their home.

While loan prequalifications can give you an idea of how much you can afford, it could lead to disappointment later if a home seller wants to see your approval and you aren’t prepared. However, they are better than nothing, so check with your agent to see what is preferred.

Getting Only One Mortgage Quote

Mortgages vary a great deal. Make sure you are getting one that will be best for your current and future goals by getting at least four quotes to compare. Yes, it’s a little time-consuming, and you just want to get down to looking at houses, but you don’t want the joy of your home purchase to be dampened by financial problems you could have avoided.

Biting Off More Than You Can Chew

Yes, bigger homes with more benefits are tempting, but a home is more than a structure; it is your future life. Will you have the money to live that life?

Make a realistic portrait of your current and future finances. List your must-haves and your nice-to-haves. You should prioritize your must-haves, and nice-to-haves can be sacrificed for savings. 

Don’t assume that because you were approved for a certain amount, you should necessarily spend that amount. The mortgage lender may be willing to lend you that amount, but that doesn’t mean that you can actually afford it.

Consider your debts, expenses not covered in the mortgage approval process, closing costs, and other moving expenses.

Using Credit Before The Sale

Between the time you get mortgage approval and finalize the sale of your home, be mindful of your credit score. Mortgage lenders frequently check your credit score a second time just before the sale. If your credit score has dropped, your loan may change or be canceled.

Draining Your Savings

Yes, the biggest hurdle, the down payment, is behind you, but closing costs, moving expenses, and surprise expenses that may or may not be related to the move could still sneak up on you. It’s important to factor in extra expenses because life is full of unforeseen events. It’s hard enough to account for all of your home-buying and moving expenses. Your finances are probably tight. Try to keep them as loose as possible by leaving a cushion in both your bank account and your savings.

Waiving A Home Inspection

Many people neglect to have a home inspection done because they don’t want to waste time or they are so enthralled with the house they don’t think they care. However, home inspections can warn you of nasty surprises in the future and maybe help you get a better price on your home.

Forgetting to Research The Neighborhood

The neighborhood is almost as important as the home itself. After all, it is where the home and your future life are located. If there is a major problem with it, it will impact your life every day. It could also impact your home’s value when you plan to sell. Look into crime statistics, education opportunities for your children, and nearby amenities.

Making Primarily Emotional Decisions

Yes, purchasing a home is emotional and you can be very attached to your dreams for a home. Remember, however, that buying a house is also the largest investment you are likely ever to make, and it will determine your future life. Do listen to your emotions, but temper them with a good deal of practicality and realism. Getting a second opinion can help you make a wise choice.

Poor Offer Timing

Making your offer on the home too early or too late could cause problems. If you rush into the offer, you may legally commit to a home you don’t really want, but if you wait, you could lose out to another buyer. Give yourself a little time to look at the home from a practical standpoint to be sure you want to commit to the house.

Assuming You Have to Pay A 20% Down Payment

Twenty percent down on a home is ideal, but it isn’t required. If you can get PMI insurance, you might be able to get into your new home with only a 6% down payment. Look into your options.

Call Wendy Gimpel Today!

The right real estate agent is worth every penny, helping you find the perfect home at a great price while navigating this new step in life. This is one of the steps to a smooth and rewarding home purchase. Contact Wendy Gimpel to get started.

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