Common Home-Buying Mistakes First-Timers Should Avoid
Construction began on about 820,000 single-family homes in November, and a good share of those eventually will be purchased by first-time buyers. But home buying is an art. Just as an artist can easily destroy a masterpiece by choosing the wrong colors, brush strokes and canvas size; a first-time buyer can ruin an investment by making some common home-buying mistakes.
Home buying surely requires a big financial investment in itself, but that’s not the end of it. Soon after the purchase of the house, things such as insurance and more come up. This is why you need to have detailed and related information regarding the procedure of buying a house. A single wrong turn onto one of these common home-buying mistakes could damage the deal.
To point a clear path to the first housewarming party, housing experts at Marjan Island have jotted down five common home-buying mistakes to avoid:
Stretching the budget and going beyond the limits
Huge investments generally are dependent on tight budgets. It’s easy to be smitten with a number of houses during the search. The one with the wooden floor and amazing architecture might be good, but then the house with the amazing beach view can tempt the buyer to up his or her bet up a few more thousand dollars, right?
This is where buyers must remind themselves to stay within the budget! That beach house might have been really adorable, but remember that there are other bills to pay. Stretching the budget for the dream house might end up in bankruptcy or the addition of more loans. Regarding this, Ellen Derick, certified financial planner for Learnvest Planning Services, says “People look at the top end of their affordable monthly payment, and they don’t really think about what happens if their income goes down or they have to change jobs.”
Thinking a real estate professional isn’t essential
Not hiring a real-estate professional to guide the home-buying process could be the biggest blunder a rookie can make. The seller likely will have one. Brooke Willmes, a real estate agent at Space and Company in Philadelphia, says, “The potential buyers should keep in mind that a listing agent (the agent representing the seller) doesn’t protect your interests.”
A buyer’s agent, on the other hand, helps to avoid any unfair proceedings and manages the house deal really well. He or she will make sure that all the possible precaution clauses are added in the deal and a fair transfer of documents is made.
Taking mortgage qualification lightly
The mortgage is a risky loan that can have a bad impact on the buyer if taken lightly. Thus, it is very important to have complete information on this subject. Before signing contract on a house, buyers need to make sure the loan is approved. Making a deal before the loan approval is not a good move to play.
Here’s a source for more information on mortgages.
Ignoring the hidden expenses
Many buyers, of course, have their plan figured out, with all the financial terms of the purchase considered, and they’re just waiting to close on the deal. A teeny tiny bit of advice is not to forget the hidden costs of buying a home. They include property insurance cost, taxes, maintenance cost, homeowner’s association fee and many other things.
Keeping such things in mind will give you a good idea about the affordability of the house. It’s not just about paying the mortgage; it’s about maintaining a healthy living as well. Having an estimate of all the hidden costs beforehand gives buyers an edge.
Excluding proper building inspection from the plan
Not getting the house inspected is a huge error – so big that most lenders won’t let happen. Even if everything looks good to the buyer, an inspector must be part of the process. He or she will look for all kinds of errors in the house – from the foundation to the walls to the floor styling, room space, ventilation, light, plumbing services and the electricity supply. A good inspection can save buyers thousands of dollars in after-purchase expenses.
None of this is meant to scare prospective buyers. All these common home-buying mistakes can be easily avoided by simply paying attention to the details and calling on professionals for help when needed.