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Common Mistakes First Time Homebuyers Must Avoid

Aug 21, 2017 04:39 PM

If you have taken the decision to have a house of your own, congratulations! It is this idea inside your brain that is your first step towards realising your dream. It’s no easy step and takes a lot of courage and determination. Now that you have the idea in your mind, what should be your next steps? Time is of essence here, as it is time or the lack of it that can play spoilsport in the realisation of your dream. When you are going to invest in a property, the primary thing to keep in mind is not to hurry. Never take hasty decisions. If something goes wrong, it will be a costly mistake.

Be prepared, more so if you are a first time homebuyer. It does not take much time to book a property if you have the money. It is also not time-taking to get approved for a home loan. All these are necessary steps and can be taken any time. What is important is to make you prepared. Do your homework. It will go a long way in making your home-buying process easier. Take some time out to educate yourself on down payments, various types of home loans, analysing your purchasing potential and all the features you want inside your house. Here we have listed down some of the common mistakes that homebuyers often commit and regret.

Not getting a pre-approval

Getting yourself pre-approved before you start looking for a house is a prerequisite. Go to a reputable mortgage lender and have a fully underwritten pre-approval. This will let you exactly know about your buying power, down payment required, various loan types and remove the stress if you are denied after selecting your dream property.

Unrealistic expectations

Once you are aware of your buying power, you are sure about the type of properties you can go for. Based on your purchasing power, you can expand your search to newer areas.

Not consulting a professional buyers’ agent

Every prospective homebuyer must consult family and friends for advice but not forget consulting professional buyers’ agents. Interview at least a few of them and select the one you are most comfortable with. He/she will represent you and do the necessary work for you.

Not inspecting the home properly

Seasoned property investors know the areas they must look into. On the surface, everything may look great, spic and span. But look at the right areas, and you may come across problems. Protect yourself from large, pocket-burning repairs, even when you are going for a totally new property.

Not being in touch with the lender

A pro is always in touch with each and every person he/she comes across during the home buying process. As the bank manager to prepare a complete cost analysis for you with home owners’ insurance, mortgage insurance and taxes. Share a copy of the utility bills. Be absolutely sure about the costs and expenses involved before jumping into the process. The cost og home ownership can go up manifold if you are not mindful.

Not knowing the appreciation value

Even though most properties appreciate over time, as an informed buyer, you must be aware of the appreciation value of your property. There are certain properties that may not generate appreciation as expected even when the housing market is on a high.

Not getting to know the neighbourhood

Simply buying a house and decorating it as per your preferences is not enough. After all, you are going to live there. Hence, it is your prerogative to know your neighbours and the area you will be spending a major portion of your life in. Speak to the people to know about the problems they face. Is there a water shortage problem? Is load shedding an everyday affair? Is water-logging a major issue?

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