10 Things First Time Home Buyers Think And What They Need to Know!
In this day and age, it sometimes seems like everyone’s an expert; and, that can be the case when it comes to first-time homebuyers as well. Unfortunately, we all know what happens when you assume… and, assuming you know everything about your first home purchase can be a costly mistake. Here are 10 (not-so-accurate) things that first-time homebuyers may think: 1. “I don’t need to find financing before I find a house.” Many first-time home buyers misunderstand the importance of gaining mortgage pre-approval before they begin searching for a home. But, the fact is that you may not have an accurate idea of what you can afford unless you secure pre-approval from a lender. Another perk of pre-approval is that sellers will see you as a more serious buyer. 2. “My average credit won’t affect my mortgage.” Because they’ve never gone through the mortgage approval process before, some first-time buyers don’t realize the importance of cleaning up their credit as much as possible before applying for a mortgage. Bad credit can not only derail mortgage approval, but even if a buyer with poor credit is approved, they can expect higher interest rates. 3. “Of course, I’ve saved enough money to buy a home.” Once a buyer has enough money for their down payment, they may think they’re done with the upfront costs associated with buying a home; however, there are other fees involved in the closing process that may require buyers to come up with quick cash to bring to the closing table. 4. “This house is just a little out of my price range and needs a couple – it’s perfect!” There is a difference between being well-intentioned and just plain naïve when it comes to buying a home. If a home falls in the upper echelons of your price range and needs some hefty repairs, the only thing it is perfect for is passing on! 5. “The right house in the wrong location is still the right house!” Finding the right first home can be a long process; so, when a buyer finds a home they love in a location that doesn’t quite meet their needs, they may be tempted to overlook that very important feature. But, settling in the wrong area – even though the home seems right – still can lead to an unhappy first-home experience. 6. “This home is perfect for me right now. I can always move in a couple years.” Buying a home is typically the largest purchase a person ever makes. So, it should involve a lot of thought – about both current and long-term life goals. Losing sight of future goals during the home-buying process can result in a home that simply doesn’t work out in the long run. And, frankly, who wants to try to sell and move every couple of years?! 7. “I don’t need a real estate agent. I already found the home I want.” Some first time home buyers may think that they’ll save on real estate agent commission fees if they try to move through the buying and closing process without an agent. However, this can be downright dangerous. Real estate agents are paid a portion of a home’s selling price, which is typically determined in a seller’s contract with their agent, who agrees to split that percentage with a buyer’s agent. On a buyer’s end, their agent is there to ensure his or her interests are represented, from the home search and offer process through closing and often beyond!p>
8. “We can always work up from a low offer!” Inexperienced home buyers may think that lowballing a seller will only entice them to meet somewhere in the middle. However, submitting a low offer may insult and turn-off a seller completely, causing a buyer who is actually interested, to lose a home they love. 9. “Our offer was accepted – let’s move in tomorrow!" First-time home buyers may not understand that there is a period of time between having their offer accepted and move-in day. That closing period, which includes necessary things like home inspections and appraisals, typically lasts between 30 and 60 days. 10. “Sure, I can skip the home inspection!” When a first-time home buyer finds a home they love and their offer is accepted, they often want to run straight to closing. Hastily moving through the closing process and skipping the home inspection altogether can cost home buyers in the long run. The home inspection is also vital, because it can give buyers an out if something is found to be seriously wrong with the home they’ve selected. Are you a first-time home buyer who has thought one or more of these things?
Think it’s time for a little help in your home-buying process? Visit our First Time Home Buyer’s Guide for lots more information on buying your very first home.
