6 Common Mistakes Homebuyers Make
Buying a home is both exciting and nerve-wracking. The people who are most prone to these mistakes are novice buyers or buyers who last bought a house many years ago. Nevertheless, some mistakes keep repeating themselves with buyers, and we want to help you avoid them. Here are some common mistakes homebuyers make:
1. Prioritizing the search over applying for a mortgage
One mistake that many buyers, especially inexperienced ones, make is to start viewing houses before they talk finances. Okay, we understand that looking at homes is more fun than sitting down with a lender to talk figures; however, doing that is unwise for a few reasons. First, if you find an amazing home, you won’t have the capacity to make as compelling an offer as someone who has their finances figured out. This could lead to you missing out on a dream house. Second, not knowing your price range can lead you to go through homes outside your price range, thus wasting your valuable time.
2. Taking out big credit before closing
The period between you successfully apply for a mortgage and finalize the deal is critical from a credit perspective. Lenders tend to check your credit score one last time before finalizing the deal to ensure that nothing has changed dramatically in a manner that will affect repayment. If you do something that lowers your credit score (could be as innocent as buying furniture and appliances on credit for the new house), your lender might decide to change the terms of your mortgage. In the worst-case scenario, the mortgage may be canceled at the eleventh hour.
3. Being too picky
While looking for your ideal dream home should be a priority, there is such a thing as being too picky. If you close your eyes to houses that don’t meet all your criteria, you may end up missing out on some decent options. Sometimes, it is okay to settle on a house that is not perfect if it meets at least a majority of your requirements.
4. Failing to consider government-insured loans
When buyers cannot afford conventional loans, they often don’t look into alternatives such as the government-insured ones. They end up postponing the purchase and as prices go up, they miss out on buying cheaper. Check with agencies like the Federal Housing Administration (FHA), the Department of Veteran Affairs (VA), and the Department of Agriculture (USDA) to see if you qualify for their loans. Most of them offer favorable terms.
5. Being impatient
The market is dynamic; therefore, sometimes it favors sellers while other times it swings the other way. When you become frustrated because finding a home is taking too long, you may be tempted to buy into a strong sellers’ market. By doing that, you will spend more than you could have if you had waited a little while for prices to ease.
6. Underestimating potential repair costs
A significant number of homeowners do not factor in the realistic renovation costs they may incur once they buy the house. This could be because they received low estimates from one contractor, and they never bothered to reach out to other contractors. To be safe, ensure that you obtain your repair estimates from more than one contractor. Once you have the quotes, budget accordingly and allocate more rather than less if you can.
And those are the 6 common mistakes that homebuyers make. Hopefully, this guide will help you avoid these common pitfalls. Whether you are looking to buy a home or sell a home, JAM Properties can help. We are a real estate solution and redevelopment company located in Orange County, CA. No matter what your situation is, we can assist you. Contact us any time and let us give you our free, honest advice on your personal situation. Send us an email to firstname.lastname@example.org or call/text 949-438-4343.