Home BUYER Mistakes

(Top 10)

1.   Waiting for the perfect home:  Looking for the home that checks every one of your boxes to perfection can narrow your choices too much, and might lead you to pass over good, suitable options in the hopes that something better will come along. Keep an open mind about what’s on the market, and be willing to put in some sweat equity.

2.   Buying more house than you can afford:  It’s easy to fall in love with homes that might stretch your budget, but overextending yourself is never a good idea. With home prices trending upward, it’s especially important to stick close to your budget in case you fall on tough financial times.

3.   Looking for a home before applying for a mortgage:  Housing inventory is tight because there’s far more buyer demand than affordable homes on the market. In such a competitive market, you’ll find it almost impossible to get your offer taken seriously unless you have a mortgage pre-approval (or cash in hand). That’s because sellers won’t want to take a risk on someone who isn’t even certain they can get a mortgage.

4.   Talking to only one lender:  By not comparing offers, you’re potentially leaving thousands of dollars on the table. Shop around with at least three different lenders, as well as a mortgage broker. Try to get rate quotes all in the same day, since rates change regularly. Compare rates, lender fees and loan terms.

6.   Fixating on the house over the neighborhood.  Being nit-picky about a home’s cosmetics can be short-sighted if you wind up in a neighborhood you really don't care for.

7.   Making decisions based on emotion:  Buying a house is a major life milestone. It’s easy to get too attached and make emotional decisions, so remember that you’re also making one of the largest investments of your life.

Emotional decisions could lead to overpaying for a home and stretching yourself beyond your budget.

8.   Miscalculating the hidden costs of homeownership:  As a new homeowner, there are many other potential expenses to budget for, like property taxes, mortgage insurance, homeowners insurance, hazard insurance, repairs, maintenance and utilities and more.

9.   Being careless with credit:  A mortgage lender will pull your credit report at pre-approval to make sure things check out, and then again just before closing. Your lender wants to make sure nothing has changed in your financial profile. Don’t open new credit cards, close existing accounts, take out new loans or make large purchases on existing credit accounts in the months leading up to applying for a mortgage.

10.   Skipping the home inspection: The home inspection is an added expense that not every homebuyer might be tempted to forego. But professional inspectors often notice things most of us don’t, so this step is especially important if you’re buying an existing home.  If the home needs big repairs you can’t see, an inspection helps you negotiate with the current homeowner to have the issues fixed or adjust the price accordingly.