Buying a home can be fun and exciting, but there are also some common mistakes that many people make. Here are 5 things you should avoid when shopping for a home:
1. Don’t buy a house without a real estate agent
In these days where everything can be done online it’s easy to forget that purchasing a home is a big financial move. Of course it is super exciting to look online and doing this can be helpful for you to figure out what you like and what not. But finding the right home is just one part of the buying process; there’s so much more to it – like negotiating, writing up the offer, ensuring a smooth transaction – and a professional real estate agent can help you through each step.
2. Don’t get a loan from a random bank
Once you have found a trusted real estate agent, it’s time to meet with a mortgage company to talk about finances and to get you pre-approved. Most likely your real estate agent will recommend a few lenders he or she has worked with and has had good experience with before. While this can be very helpful, it is up to you as the buyer who you want as your lender. You might want to talk to a couple of different lenders to get all the options and find the best loan for you.
3. Don’t over- or understate your budget
After you have spoken to your preferred lender, let your real estate agent know what your real budget is. If you can only afford a home for $250,000, but let your agent show you houses in the $400k range, it’s a waste of time for everyone. But also don’t understate how much you can and are willing to spend, otherwise you might not get to see houses that might be a great fit for you.
4 Don’t make an absurdly low offer
We all want to save money, especially when talking about thousands of dollars. But when your offer is too low you might offend the seller and risk not even getting a counteroffer back. Your real estate agent should know the market and can help you with assessing the right purchase price.
5. Don’t be a big spender
Now that you bought a new house you might feel tempted to buy new furniture or a new washer/dryer – don’t do it. Your credit is monitored and any big purchases will throw off your debt-to-income ratio, which could jeopardize your loan approval. Keep the the balances on your credit cards low and do not take on new debt until after the sales closes.
By: Patricia Madigan