Buying your first home is as difficult as it looks exciting as every time a first time home buyer enters the market it is without experience and as we all know the world out there is more experienced than them. Thus there are changes of first time home buyers getting cheated or can take an inappropriate decision. Thus to assist the first home buyers, here is FinanceShed with a guide on mistakes first time home buyers should avoid.
Buying Without Budgeting
It is obvious to fall in love with the home you cannot afford but take care you don’t end up buying it. Without knowing how much house you can afford, you could end up looking at houses that you can’t afford to waste your time and energy without any positive output. Instead, you can carefully review your finances and set a budget and for this, you can also take an expert’s advice about how to set a budget based on your income. You must also know about How To Budget Your Money for all your plans.
Moving Too Fast Without Proper Savings
There are various mortgage programs that allow you to pay almost nothing as a down payment or a very little amount also available with even 0% down mortgages. Buying a home can be complex, particularly when you get into a buying process without considering your savings and just going for buying spending all or most of their savings on the down payment. This practice is one of the common mistakes seen among first time home buyers.
Not Checking With Your Credits
It is very much important to have a check on your credit scores as this can play a role of a game changer as Mortgage lenders will scrutinize your credit reports. On the basis of this report, they decide whether to approve and if yes what should be the interest rate. Before applying for one, try to Review your credit report once a year and dispute any errors that might appear.
Not Going With Special Programs
It is obvious for a first-time buyer that you do not have a lot of money for your down payments. Also, there are other expenses while buying that needs outflow of funds. For covering all this you should try not to ignore the special programs as there is a number of programs that offer low-down-payment and assistance for competitive mortgage rates for first-time home buyers.
Also Read: Types Of Home Loans You Must Know About
Not Being Practical
You cannot buy a home every now and then and thus we can consider buying a home as a serious milestone in your life which needs a lot of attention and planning. It is very important that while buying a home you do not get emotional about the memories, neighborhood, etc. You are making a huge investment of the lifetime and so it is impractical to be emotional. Try to stick to your budget and requirements, see it’s just that simple.
Ignoring The Hidden Costs
Buying a home just does not come with a single cost of acquisition as there are numerous other costs that are to be incurred by an owner. An average homeowner according to the study, pays $2,000 annually on maintenance services. It is important to consider the costs associated with buying a home such as property taxes, hazard insurance, repairs, maintenance and utilities, Mortgage Insurance, homeowners insurance and a lot more.
Finalizing Before Applying For Mortgage
Never, we insist never start looking for a home before meeting with a mortgage lender. Meeting with some of them will help you to consider the present condition of the market and will give an idea of not to fall for the home that is out of budget. We also insist on getting written approval as this can help the seller to understand that you are more serious about buying one.