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First-Time Home Buying Blunders To Avoid

Like so many other people, you might feel ready to stop renting, and finally buy a place of your own. Before you finalise the deal and walk over the threshold of your new place, there are a number of essential steps you have to go through, such as getting approved and finding the right real estate agent for your needs. The whole process leaves a lot of room for error, and your plans could blow up in your face if you don’t approach it carefully. Here are some common first-time buyers’ mistakes to avoid…

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Failing to Look Past the Mortgage

A lot of first-time buyers take their first steps in the buying process when they look at their personal finances and decide that they’re ready for a mortgage. However, just because you can comfortably afford a mortgage does not mean that you can comfortably afford to own a home. There’s much more to being a homeowner than keeping on top of those payments. You’re going to have to worry about property insurance, taxes, maintenance, increased utility bills, and other expenses that some first-time buyers tend to overlook when they’re planning to buy a place. Make sure you’re not being too short-sighted when it comes to the cost of home ownership.

Looking for a Home Before a Loan

Unfortunately, the home-buying process doesn’t start with the exciting task of going to viewings and comparing different properties. It starts with mortgage pre-qualification, unless you happen to be wealthy enough to buy your first home outright. Then you can start checking out some mortgage comparison sites, and narrow your search down to the loans that are suitable for your circumstances. In a lot of cases, first-time buyers are hesitant to try and get pre-approved. Many are scared that the lender will tell them that they don’t qualify for a mortgage, or that they only qualify for a loan that’s much smaller than they expected or needed. Getting approved for a mortgage may feel daunting the first time you try it, but it’s much better than picking an unfounded price range and starting to look at homes straight away!

Not Getting All the Help You Need

When buying a home, especially if this is your first rodeo, you need a network of professionals to help you through the whole process. This typically includes a good loan officer or broker, and experienced real estate agent, and possibly a property solicitor. Understandably, you’ll want to keep costs down and avoid paying for any extra services wherever possible. However, launching into the process alone, with no professional help to fall back on, is rarely a good idea. Sure, every rule has its exception, but the large majority of first-time buyers will only get burned if they decide to deal directly with the listing agent. Research the kind of services you may end up needing, and start reaching out to agents and loan officers as early in the process as possible.

Breaking Into your Savings for the Down Payment

One of the most damaging mistakes any first-time homebuyer can make is spending all or at least a significant chunk of their savings on the down payment and closing costs for a property. There are many people who rake all their available cash together, and make the 20% down payment so that they don’t have to pay more for mortgage insurance. However, having to pay for this kind of hefty policy is much better than leaving yourself with very little or nothing at all in savings. You may have already done a little maths, looked at the extra cost of insurance on your monthly mortgage payments, and immediately thought that making a larger down payment is a no-brainer. Though you’ll certainly save something on a month to month basis, it’s never worth living on the edge, with no financial safety net that you can fall back on if and when things get tough. What happens when a pipe bursts, the boiler needs replacing, or any of the other domestic disasters that can happen? Ask any real estate professionals, and they’ll all tell you they’d take mortgage insurance any day against not having any money for a rainy day. Don’t make yourself vulnerable for saving a few pounds a month!

As you take your first steps towards getting on the property ladder, bear these mistakes in mind, and do your best to avoid them. Finding a house that’s right for you is never easy, but with a careful approach, you can make the whole process so much smoother.