Thursday, September 21, 2017 / by Tom Nickley
Purchasing your home can be a tricky process. Today, I wanted to go over five of the most common mistakes made by first-time homebuyers.
Hopefully by going over these mistakes, I’ll be able to help you avoid making them when you move forward with purchasing your first home. Knowing what not to do can be just as important as knowing the things you should be doing.
1. Assuming you won’t be approved for a mortgage. A high credit score, a low debt-to-income ratio, and a 20% down payment are always ideal. However, not all of these things have to happen. It’s a lot easier these days to get approved for a mortgage. Confer with a local lender to find out what kind of purchasing power you have. It could be more than you think.
2. Not getting pre-approved early. Many first-time homebuyers underestimate the importance of getting pre-approved early on. Pre-approval gives you a really clear picture of what you can afford and what your payments will be like. It also grants you the ability to make serious offers when you do find a home that is right for you and your family.
"Knowing what not to do can be just as important as knowing the things you should be doing."
3. Letting your emotions take control. A lot of homes right now are receiving multiple offers, making it a very competitive market. This can make buyers feel frustrated and defeated, but it’s important to not let those feelings get the best of you. You may not get the first or second home you put an offer on, but don’t get discouraged. Also remember not to get caught up in the heat of the moment and offer too much for a home out of the frustration of having already lost out on a previous property.
4. Waiving contingencies without understanding the risks. First-time homebuyers sometimes have a tendency to waive things like inspection or appraisal contingencies, but this can be a big mistake. This is rarely the smartest way to go with such a big financial decision.
5. Allowing your credit score to change before closing. The absolute worst thing you can do during the home buying process is to add additional hits to your credit. Buying a car, buying furniture, or taking out a new line of credit can have a substantial impact on your credit. This could have a much bigger influence on your ability to purchase the home than you may realize.
By avoiding these five mistakes, you should be in a much better position than some other first-time buyers.
If you have any other questions or would like more information, feel free to give me a call or send me an email. I look forward to hearing from you soon.