First-time Home buyer mistakes are pretty common. That much is evident from the number of homebuyers who made big mistakes in buying homes in the past years. If you’re venturing into the market for a loan to buy a home, go prepared.
Don’t make the same mistakes your friends, parents, and siblings made when they first went out to buy a home. We have created this small guide to help you fight back and avoid the five most common first time home buyer mistakes. By the end of this post, you’ll be equipped with the right knowledge to get a loan and strike a perfect deal.
Most Common 5 First-Time Home Buyer Mistakes
So without further a due, here are the 5 most common first time home buyer mistakes that you should avoid no matter what.
Avoid Miscalculating Your Budget
The first and foremost thing that you need to be aware of is your own budget. You have to know exactly how much house can you afford. If you don’t consider this, you are going to end up a lot of time visiting houses that you can’t afford even after taking a mortgage.
For a lot of first time home buyers, the common goal is to get a loan for a house that they can comfortably pay every month. So it is always a good idea to aim low instead of going high and opting for a jumbo loan.
In the modern-day, you have the internet to help you calculate your affordability. Just look around and you’ll find plenty of calculators to help you figure out what price range is affordable for you. If you still cannot understand, talk to a mortgage officer. Aceltis Group financial experts can help you figure out how much you can actually spend on a house without ending up with a loan you can’t easily pay every month.
Survey the Market
It is enticing to sign a deal when you go out for a mortgage as soon as you find something that falls in your budget. But we highly recommend that you survey the market for the best rate possible.
A lot of mortgage companies give different quotes depending on their individual requirements. If you come over to Aceltis Group, we can connect you with many lenders across the country to help you find the best rate possible.
Applying with multiple mortgage lenders will save you as much as $500 in the first year compared to going with a single lender that impresses you the most.
Avoid Making a Small Down Payment
You don’t really have to make a 20% down payment to buy a new home. Some mortgages allow you to pay a minimum of 3.5% down payment. While this is a good idea to pay a low down payment price, in the long run, you could end up with regrets.
The lesser the down payment you pay, the more your mortgage interest rate will become. In other words, you’ll end up paying the price or mortgage insurance on top of the monthly payments of the mortgage. That is adding a lot of money on top of an already high monthly payment.
Don’t Ignore Loan Programs
There are a lot of loan programs available in 2019. These loan programs can actually help you a lot because many of them allow you to buy a home with zero or very little down payment. Check for options like VA loans, FHA loans, USDA loans and more.
Pick the one that suits you the best. If you’re not sure whether you are eligible for such loan programs, talk to us today and we’ll find you a loan program.
Don’t Spend Everything
First-time home buyers often end up buying pre-owned homes. These homes usually require a lot of repair and maintenance before you can move in. Even if you do move to such a house, you will have to get some things in order from time to time.
Whatever the case is, don’t end up spending all your savings on repairing and maintenance costs before you move in. Take a break and make sure you have plenty of money remaining in the savings account because you will have to pay for other things like closing costs, moving expenses and emergency repairs.
First-time homebuyers are often clueless about how mortgages work and they typically end up spending a lot more than it is required. If you’re buying a home for the first time, we can help you find the right mortgage so you don’t end up wasting a lot of money.