4 Costly First-time Home Buying Mistakes to Avoid
The best home buying experience is one where all goes according to plan — the first house is the perfect house, acceptance of your first offer, and a smooth transition to signing on the dotted line. While the process is (almost) never that easy, there are things you can do as a first-time home buyer to avoid making mistakes that can cost you big time in the long run.
MISTAKE: Not having (and sticking to) a budget
Before you even start your home search, you have to establish a budget that includes even the unexpected. One of the most costly mistakes first-time home buyers make is looking at homes that appear to be within their price range, only to find out during the process that the budget did not include things like inspections, moving costs, and home owners insurance.
MISTAKE: Not knowing your credit score
If you don’t know your credit score, you have no idea how a bank will consider you as a candidate for a mortgage loan. If your FICO score is low, you’ll need ample time for repair. In order to be eligible for the lowest interest rates possible, lenders are expecting to see a credit score in the 700 or higher range. Improving your credit score should start with knowing where you currently stand. From there you will need to make sure you are paying bills on time and lowering your debt to income ratio as much as possible.
MISTAKE: Not clearly defining your needs vs. wants
It can cost both you and your agent a lot of unnecessary time looking at homes that don’t match your set criteria. There are many things you may want in a home, but before you make an offer, at least most of your needs should be met. Choosing a home with more of your wants than your needs will cost you more in the long run because eventually you’ll have to make those needs a reality.
MISTAKE: Foregoing a home inspection
A home inspection is exactly that; an inspection done by a professional who delves into the spaces of your home both readily visible and what’s going on behind the scenes. If you buy a home without having it properly inspected, the problems you could face after moving in could be extravagant.