Mistakes to Avoid When Purchasing a New Home
The purchase of a new home is a significant financial investment, and one that should not be taken lightly. There are a number of potential mistakes that home buyers can make during this endeavor, which can end up costing them both financially and emotionally. In this blog post, we'll explore some of the most common mistakes people make when purchasing a new home and explain how you can avoid them for the smoothest home buying experience. By being aware of these pitfalls, you'll be in a better position to navigate the process successfully and end up with the home of your dreams.
Focusing too much on the mortgage rate
Shopping for a mortgage can be an overwhelming process, and many potential buyers focus too much of their attention on the rate they are offered. Home buyers should instead focus on the monthly payments they will be making and allow those payments to drive their purchasing decision. Savvy buyers know that unfavorable interest rates are only temporary and are bound to become more manageable in the future, at which point they can always refinance. The real problem comes when people wait for interest rates to drop before beginning their home searching process (think of how competitive it was in 2019-2021). Looking at the long-term costs of different rates and terms can lead to significant savings overall. While it is noteworthy to ascertain which lender is offering the most competitive rate, understand that the focus should be placed primarily on the size of your payment each month and how much you could potentially save over the life of the loan.
Thinking you need to save up 20% for a down payment
When there is a goal to purchase a home, there are many challenges that come with it. One of those is the enormous price-tag and the pressure to save up 20% for the down payment. Although that is conventionally what buyers may be expected to do, there are other loan options available that reduce or altogether eliminate the need to come up with this large sum of money. These low down-payment or no down-payment loan options offer individuals and families the opportunity to become homeowners without feeling like there is an insurmountable amount of money standing between them and their dream. Working with a licensed mortgage specialist can help you understand all of your options so that you can make an informed decision about the best option for you and acheive your dream of home ownership sooner than you anticipated.
Trying to purchase your home on your own just to save money
Purchasing a home is a big decision and undertaking, and it can be tempting to try tackling it on your own to save as much money as possible. However, getting help from an experienced real estate agent often ends up saving you money in the long run. Without proper knowledge of the real estate market and the legal papers involved, you may get taken advantage of and end up with a house that is much lower in quality than its true worth. Getting professional help can both ensure you get the best value for your money, as well as get you peace of mind that things are being done correctly. It's important to remember that sometimes the help will cost upfront, but it could actually save you money in the long run.
Not getting pre approved before looking at houses
When it comes to buying a house, one of the most important steps to take is to get pre approved before you start looking. Not getting pre approval can lead to confusion, frustration and feeling overwhelmed by the process. Buyers who start their home search prematurely often end up feeling let down when they qualify for less house than they initially expected. Pre approval gives buyers perspective on what they are actually able to afford and provides them with an idea of how much they could be looking at paying each month in mortgage payments. Being pre approved takes some of the guesswork out of budgeting for your dream home and gives buyers peace of mind that when it comes time make an offer, they won't have to worry about overextending themselves financially. Get pre approved today so you can start searching with confidence!
Passing on a great home early in the search because it's not "perfect"
It can be tempting to pass on a great home you find early in your search and continue looking for something more perfect, however that could be a mistake, espcially when you consider the lack of homes currently on the market. If something isn't quite right but the home checks most of the major boxes, don’t discount it and hastily move on — even little issues like an outdated kitchen or aged carpets can be worked around if the location is ideal or there’s plenty of potential for improvement. In order to make sure you're selecting the best possible living situation, weigh all of your options carefully and take your time before making your final decision. Don't get too caught up in what ‘could be’ instead of what currently is.
Buying a home is a big decision, but it doesn't have to be as daunting as you may think. Keep these tips in mind during your searching process and you're sure to find the perfect home for you and your family in no time. And remember, we're here to help you every step of the way. Contact us today for more information on how we can fid you your dream home!