Mistakes To Avoid When Buying A House: Purchasing your first home is certainly an exciting venture; however, it’s also one that includes all sorts of major decisions as well that can make the entire process stressful. In fact, it can create so much stress that those who are purchasing a home for the first time can end up making some of the most common mistakes, which can unfortunately result in buyer’s remorse.
Here are four of the most common mistakes that all first-time homebuyers should always avoid making.
*Perhaps one of the most common mistakes that first-time homebuyers should always avoid making is moving through the entire process much too quickly. In the event that you do this, it will result in you being unable to save enough money for both a down payment and closing costs. Additionally, you will also be unable to deal with items listed on your credit report that will keep you from being able to obtain loan terms that will be much more favorable for you.
*Another of the most common mistakes that should always be avoided by all first-time homebuyers is searching for a home before actually applying for any kind of a mortgage. Oftentimes, there are many buyers who begin to look at homes before they even begin speaking to a mortgage lender. In fact, a majority of markets right now are experiencing a very tight inventory in terms of housing due to the simple fact that buyer demand has increased, while the amount of affordable homes has not.
*One other of the most common mistakes that all first-time homebuyers should always avoid involves being rather careless with their credit. When it comes to credit reports, these are always pulled and viewed by mortgage lenders during the pre-approval stage in order to ensure that everything regarding a buyer is legitimate, as well as once again prior to the closing process. Lenders do this in order to ensure that no changes have been made in terms of a buyer’s actual financial profile. In the event that you end up getting too careless with your credit, such as obtaining any new credit card accounts and/or loans that show up on your credit reports, this can end up affecting both the closing and final loan approval, thereby potentially preventing you from being able to purchase the home that you want.
*Another common mistake that first-time homebuyers will always need to avoid is making the assumption that you will need a 20% down payment. The simple fact is that this is absolutely untrue. Even though this amount will actually help prevent you from having to pay any private mortgage insurance, there is a vast majority of buyers who either won’t or can’t put down that kind of money. In fact, the truth is that the median down payment for a home is approximately 12%; however, for first-time homebuyers, that amount is only 6%. It’s important to note, however, that HOA’s, condos, and co-ops could potentially require you to put down a larger amount for a down payment, meaning that it’s always a good idea to consult with your real estate agent in regards to these requirements so that you are able to budget properly. In the event that you do attempt to save a 20% down payment in order to make a home purchase, you can end up taking years to do this, as well as not obtaining any further financial goals that you may have in mind.