For most people, buying a new home is the biggest financial investment of their lives. On top of that, the amount of time you will put into finding the right home and filling out financial and legal documents adds a whole new layer to your commitment. When it’s your time to make the leap and buy a new home, you’ll want to avoid silly mistakes that people have made in the past. Below are a couple tips of things you should avoid when buying a home, whether you’re a first-time buyer, or experience with the industry.
#1) Not budgeting for collateral costs
When you buy a home, you’re not just paying for the home. You’re also paying for all the services provided to help you along the way, as well as paying for closing and escrow services to set you up as a long-term homeowner. If you want an accurate representation of what homes you can buy, you’re going to have to take into consideration all of the collateral costs involved. These can vary based on the price of the home and what kind of home you’re buying (foreclosure, short sale, as-is, etc.)
If you’re buying a home as-is, you need to make sure you understand what the costs will be to fix the home after closing. Some maintenance can be urgent and others may be less-urgent, so take that into consideration as you look for a home.
#2) Not getting pre-approved
To sellers, buyers who get pre-approved for a home loan appear a lot more serious about the financial commitment they’re making. Additionally, preapproval is the best way for you to determine what houses you will be able to afford. While you’re at it, check your credit score and try to improve it if necessary.
#3) Searching unaffordable homes
This is probably the most common mistake made by new homebuyers. The truth of the matter is, if you’re committed to finding a home right now, you are going to have to search for a home that is currently within your budget. You don’t want to have to back out halfway through your search only to find out you weren’t prepared. If you have any doubts that your ideal home is outside your limit, stop your search and wait until you’re ready.
#4) Not thinking long-term
Whether we like it or not, homebuying isn’t just something that happens and it’s over. Like we talked about with collateral damage, there are also unseen consequences of buying a home that you may have not initially thought of. Will you feel comfortable in this home 10 years from now? Is the neighborhood safe for you and your family? Will your kids have a good school nearby to go to? How long will it take to fix up a home if I buy it as-is? These are all questions that you should be asking yourself before you close.
#5) Not planning ahead
Going along with not thinking long-term is not planning ahead. Everyone’s situation will be different and nobody knows it better than you. If you’re hiring a real estate agent, you won’t want to wait until the last second to start doing your research. The real estate market changes fast, and if you’re not following it months ahead of time, you’ll most likely be lost when the time comes to start looking. This will slow down the process and cost you more money in the long run.
Are you looking for a home in Sarasota? Royal Business Consulting will help you find the best home for you and your family. Our team of experts will help you get a foreclosed home, fixed up, and ready for you to buy with as little hassle as possible. Contact us today to get started!