Buying a home is often a rite of passage during adulthood. However, as common as buying a home is, many people are clueless when it comes to buying a home. While the first time you do many things may result in some mistakes that you learn from, buying a home is no place to learn as you go. Educating yourself on the process before you even begin looking for a home is integral to saving time, money, and the headache of unnecessary issues that may come up later. Do your homework and avoid the most common mistakes for first-time homeowners.
Common Mistakes for First-time Homeowners
A home is a major investment that includes a lot of time, money, and jumping through hoops when it comes to purchasing one.
Failing to Lender Shop:
Unless you are paying in cash, you’ll need a lender. In fact, it’s advisable to research and talk to multiple lenders before you start the home buying process. It’s a good rule of thumb to speak to at least three lenders as they can help you determine the rates, lender fees, and loan terms that are best for you. If you go with the first lender you talk to, you may miss out on a better deal, which can cost you a lot of money.
Searching Before Preapproval:
Searching for your dream home without being preapproved for a mortgage can lead to heartbreak. The housing market is really competitive for buyers right now. If you aren’t preapproved, you risk missing out on your dream home, in addition to lacking a realistic plan in terms of a home budget. Focus on your mortgage application before you start searching for your home to save yourself from losing out on a great home.
Biting Off More Than You Can Chew:
If you are a first-time homebuyer, it’s important to remember that this is your first home and not your forever home. Your first home should meet your expectations, but it should also be realistically within your budget. Having a dream home that is out of your budget can create way more problems in the future. It’s important to remember that even if you qualify for a certain amount from your lender, it doesn’t mean you need to actually buy a home for that amount. A good rule of thumb is to pay no more than 28% of your monthly gross income on your mortgage. Keep that in mind and be conservative to ensure you aren’t burdened with monthly payments out of your price range.
Rushing the Process:
Once you decide to buy a home, you may want to get moving quickly. While being proactive is great, rushing the home buying process can cost you in the long run. Keep in mind that you need to have enough money for the down payment and closing costs. So focusing on saving is integral to your plans and overall timeline. Once you decide it’s time to buy a home, give yourself at least one year to get through the entire process so you aren’t left feeling let down if it doesn’t happen as quickly as you’d like.
Avoiding Your Credit Score:
A large part of the mortgage process involves your credit score. Many people avoid their credit score due to the stress that it can cause. However, having a good credit score can make your home buying process so much smoother. Work on improving your credit score before you consider buying a home. That way it’s good to go by the time you meet with a lender.
Helpful Solution to Home Buying Mistakes
Have you found yourself in a tough position due to having made mistakes when you bought your home? Do not worry, you are not alone. The market can fluctuate, personal issues can come up, and there are a variety of other reasons why you may need to sell your home and get out of debt. There are a variety of foreclosure options for homeowners, so you won’t be left without a way out. It’s best to get help from a professional so if you need help selling your home, contact the top Los Angeles short sale realtors at Apex Solutions for help. Their team is equipped with the skills necessary to get your financial future back on track.