Whether you don’t see yourself settling down for a good number of years to come or if you want to establish a solid family life the soonest time possible, one of the most important decisions that you will ever make is choosing which home to buy. It does have a lot to do, not just with your future plans, but with your finances as well. You wouldn’t want to be stuck in house with a huge mortgage that will take up a chunk of your paycheck, and you don’t want to compromise on owning something too small, either. So how will you create that delicate balance between the two? That is exactly what we will try to discover here
Taking the First Step when Buying a Home
Before enumerating the top mistakes that you should steer clear of when buying a home, let us first have a quick preview of the factors that you do need to take into consideration. Perhaps the most important question that you need to ask yourself is: when is the best time for me to personally buy a home? Naturally, if you are already settling down with a family, buying a home is a must.
However, if you are still enjoying the single life, decide whether buying your own home instead of renting is a practical solution all the way round. This is especially true now that the entire world is experiencing an economic crunch. You wouldn’t know when the real estate industry will drop again, or if the company employing you is even on a stable condition. Just to be on the safe side, put off the decision for buying a home at a time when you are more or less stable financially.
Once you have decided whether now is the right time for you to purchase a home or not, you can move on to considering these other factors when purchasing a home: – The style/size of home that you want. – The neighborhood that you wish to live in. – The location of the home. – The quality of the home’s interior/exterior. – Your budget.
The last item is particularly important because if you will not set a budget for when you are purchasing a home, you might end up struggling through the payment of your mortgages – and eventually end up losing the house in the process.
Steer Clear of these Top 10 Home Buying Mistakes.
Now that you already have an idea about the factors that you need to consider when buying a home, let us take a look at the top ten home buying mistakes to avoid, so as not to regret your decision in the future:
1. Not getting the professional help that you might need during the home buying process. If you are a home buyer and you are dealing with a real estate agent, remember that he or she is working for the sake of the seller and not you as a buyer. Sure, you need to get professional help if this is something that during the home buying process, but be careful with who you are dealing with – and make sure that the person assisting you is working towards your best interest.
2. Not having a price ceiling for the type of home that you can afford. One of the most common mistakes that first-time homebuyers make is not setting a price ceiling for the type of home that they can afford. Don’t over-extend your finances, no matter how excited you are in the prospect of finally owning a house. Make sure that the monthly mortgage payment is something that will still allow you to live comfortably, and you should be all set.
3. Not putting down enough down payment. Even if you receive an offer to buy a home with zero down payment, you have to think twice before grabbing the opportunity. Experts say that a 5 to 20% down on your home is a good enough deal.
4. Not shopping around enough. Unlike when shopping for goods at a department store, purchasing a home is a major financial decision. Take all the time that you need and make sure to look at all your buying options before making a decision.
5. Missing out on the home inspection process. Don’t think that there is such a thing as ‘falling love at first sight’ with a house. Sure, you may think that the white picket fences and the exterior of the house is straight out of a fairy tale, but keep your eyes wide open by going through the home inspection process.
6. Forgetting to pay a closer look at the location of the home. “Location, location, location” should be the motto of homebuyers. What’s the sense of purchasing a home which is miles away from the nearest hospital, grocery store or your workplace? At the end of the day, convenience with your home’s location is something that you will also be paying for – so pay close attention to this when buying a house.
7. Skipping on the pre-qualification and pre-approval process. Again, it’s important not to get over-excited at the prospect of buying a home, especially if it is your first. Don’t skip on the pre-qualification and the pre-approval process, which is something that a real estate agent can assits you with.
8. Failing to learn about the ins and outs of the mortgage process. Although the best way to purchase a home is with cash, most Americans cannot afford to do so. When taking out a home loan, make sure to understand about the basic process which will take your credit score into consideration, the avenues where you can actually get the loans, as well as the types of loans which are available for you.
9. Failing to consider all the financial aspects of buying a home. When buying a home, there are additional and hidden costs involved – from maintenance to tax and insurance, or decorating and your dues as a homeowner. Always think about these things before making that final decision on which home to buy.
10. Failing to consider the reselling value of the home. Finally, remember that the first home that you will buy will most probably not be your last. Due to job placements or other personal reasons, you might need to move out of the house that you bought in the future. As such, it pays to consider the reselling value of your home as well before signing your name on the dotted line.
This list is by no means exhaustive. There are many other factors that you need to take into consideration when buying a home, and a lot of newbie mistakes to avoid. All in all, the moral of the story is that home buying is a decision that you should not rush – and it helps if you will learn about the ins and outs of the home buying process so that you will not come to regret your home buying decision in the future.
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