If you are looking to buy a new home in the near future, and this is your first time buying a home, it can be a little intimidating. It can seem like there are innumerable challenges to overcome, and lots of hoops to jump through.
In addition to the challenges, first-time homeowners are liable to make a few mistakes along the way. Here is a list of five common mistakes that people make when buying their first home, and how to avoid them.
Not Adding In Other Monthly Expenses
Often when a person is looking to buy a home for the first time, they focus primarily on the mortgage payment. While it may be true that you can afford the mortgage payment, this is not the only expense that comes with owning a house. Make sure to avoid the mistake of getting in over your head by adding in all of the outlying expenses that come with the home. These can be things such as HOA fees, utilities, insurance, and maintenance. Before buying a house make sure you can afford the monthly payments with all the extras tacked on to that mortgage.
Buying a Fix-er Up-er Without Being Prepared
It can be great to find the house of your dreams, even if it has little quirks and small repairs needed, but beware! All of those little updates can cost a lot of extra money. These can be things such as carpeting, new paint, updates to the kitchen and bathroom, repairs in the plumbing, and updates to the yard outside. It is okay to purchase a home that needs a little love, as long as you are prepared ahead of time and have the money to do the job.
Not Factoring In Decoration
Another cost that many first-time buyers forget is the cost of decorating. Often moving from an apartment or smaller living area to a home can come with more space, and with more space, more furniture is needed. Remember to factor in the extras that you will need to furnish your new home.
Finding a Loan After Hunting For a House
One of the biggest mistakes that people make when buying their first house is to neglect to get pre-qualified before embarking on a house hunting adventure. It is crucial, not to mention helpful, to find out what you qualify for before you start searching for something that you don’t even know if you can afford.
Taking Out Additional Loans Before Closing
One of the most deadly mistakes you can make when closing on a home is taking out additional loans before the closing of a house is complete. This is because credit reports are often pulled again right before closing to verify that the borrower’s situation is the same. Taking out a loan on anything during this time could cause the deal to be a no-go at the last minute. It is important to wait until after the closing to take out any more loans for cars, furniture, or any other big purchases.