7 Biggest Mistakes You Can Make When Buying a Home
Photographee.eu / Shutterstock
Buying a home can be an exciting but daunting process. Combined with the anticipation that goes into searching for a new home, the rush of a house hunt can cause even level-headed buyers to stray into poor financial decisions or a major lifestyle compromises they later regret. Educate yourself on the pitfalls of home ownership to avoid by reading our list of the 7 biggest mistakes you can make when buying a home.
Goodluz / Shutterstock
Not Getting a Credit Report
Not sure what your credit rating is? Order a credit report and you could prevent a significant drop in your score and a lot of time wasted on wrangling a deal for a house your credit can’t support. When mortgage lenders perform a credit check and find poor credit, this can cause it to fall even further. Being proactive and ordering your own credit report can give you the time to restore your rating before you need to borrow.
Olivier Le Queinec / Shutterstock
Not Getting Preapproved for a Mortgage
Equally as important as knowing your credit rating is ensuring that you’re preapproved for a mortgage. This is because what you think you can afford and what the bank is willing to lend may very well be two different things. Get preapproved for a mortgage and you’ll have a broad sense of your budget limits while simultaneously warding off the potential heartbreak of putting in an offer on a property you can’t afford.
Marcos Mesa Sam Wordley / Shutterstock
While getting preapproved for a mortgage will provide you with a budget ceiling you can’t surpass, it doesn’t mean that you should borrow to that limit. Why? Because it’s possible for a lender to approve a loan that is beyond your means. Carefully calculate your budget, and beware hidden costs—these include property taxes, insurance rates, the price of maintenance and repairs, and utility costs.
GoodMood Photo / Shutterstock
Compromising on Needs
One bathroom for a family of four may seem like a minor issue when you’re looking out a gorgeous bay window onto a beautiful back yard and an adjacent sun-dappled park. But it’s vital that you recognize those aspects of a home you’re not willing to compromise on—if you need two bathrooms for your family of four, be sure to eliminate those single-bathroom properties from your search, unless you’re willing to shell out an additional $5,000-$15,000 or more for renovations, not to mention the time and displacement major renovations require.
Ivonne Wierink / Shutterstock
Equally problematic as down-grading to a house that doesn’t suit your needs is upselling yourself to a house is not within your budget. Be careful not to be lured into higher price ranges simply because $15,000 looks insubstantial next to a property’s six-digit price tag. Fix an appropriate price range, and don’t budge from it!
Halfpoint / Shutterstock
Buying for Now
When it comes to buying a house, it’s imperative that you buy for your future, and not for your present. It’s a mistake to assume that you can simply up and sell again in a few years when life brings unexpected changes, whether they are welcome changes, like an addition to your growing family or a new career in a different city, or changes you’d rather avoid, like losing your job. Any real estate agent worth their snuff will ensure that their clients are up-to-date on a property’s purchase history, which will tell them what the property last sold for and when. If potential buyers can see that you’re in a weak position, they won’t hesitate to take advantage of it.
auremar / Shutterstock
Cutting Corners in Expertise
Finally, it can be tempting to cut corners when it comes to realtors’ fees and home inspection costs. Don’t! While realtors are bound ethically to act both in the seller’s and buyer’s interest, you don’t want to get advice from someone who places prime value on benefits to their client, and not to you. Similarly, don’t trust what anyone other than an expert home inspector has to say about the condition of a property. When searching for a home, investing in expertise is an investment in your best interests.