Top 5 Common Mistakes That First-Time Home Buyers Make

Top 5 Common Mistakes That First-Time Home Buyers Make

Are you gearing up to buy your first home? This can be an exciting and challenging experience for you. Before you can unlock the door to home ownership, you have to take some important first steps to avoid most costly mistakes that first-time home buyers make. Renting a place is much different than buying a home, you have less responsibility and worries while renting a property but when you purchase a home, many things come into factor. For most people it may seem easy, they find a house that they can afford but unfortunately, many of those people make common mistakes that hurt them in the long run. These common mistakes are easily avoidable if you’re willing to put a little time into your home search. Arm yourself with some of the common tips that most first time home buyers make when purchasing a home.

1. Not Knowing What You Can Afford

It’s one of the first most important things to know that how much can you afford for a mortgage. If you are a first time home buyer, you’re strongly advised to track your current monthly expenses making sure to include everything e.g. vehicle costs, student loan payments, credit card payments, groceries, health insurance, retirement savings and so on. Also, don’t forget to include major expenses that only occur once a year, like any insurance premiums you pay annually or annual vacations. Subtract this total from your take-home pay (actual income) and you’ll know how much you can spend on your new home each month. This first step will decide that you can or cannot afford the type or size of home you desire, also you need to work on reducing your monthly expenses and/or increasing your income before you even start looking.

2. Skipping Mortgage Loan Qualification

Skipping mortgage loan qualification is another big mistake that first time home buyers make. There are many sellers out there who will not consider your offer unless you have a letter from a financial institution stating you have been pre-approved for a loan which means you could find the house of your dreams only to lose it for lack of one piece of paper. So if you have poor credit or unstable income, start applying for a home loan before you even start looking for a house. This not only ensures you’re able to get a loan but also lets you know how much you have to spend to get the home you want. It may be more or less than you expect.

3. Forgetting About the Hidden Costs of Homebuying

Once you’re a homeowner, you’ll have additional expenses on top of your monthly payment. Unlike renting, you’ll be now responsible for paying property taxes, home insurance and making any repairs the house needs. There are a lot of fees involved and those fees can add up pretty quickly. Here are some of the fees you may have to cover on buying a home:

• Appraisal fee
• Credit report fee
• Property taxes
• Homeowners insurance fees
• Notary fee
• Loan application fee
• Escrow fee
• Inspection fee
• Moving costs

Although, there are credits you can get to cover some of these fees and you will not all of these fees will apply depending on the lender you work with, the agreement you work out with the homeowner or the state you live in. Magna Capital Group, Inc. provides hassle-free mortgage loan on attractive interest rate with less additional fees. Call us today at (310) 734 4044 about what fees you may be responsible for and make sure you budget accordingly.

4. Skipping The Home Inspection

A home inspection is an important part of buying a home. So before going into escrow and close the deal, you have to know what kind of shape the house is in. Just like buying a used car, you must give it a thorough inspection in order to know the car is fully functioning.

You are highly recommended to make sure you get someone in your house to look it over that knows what they’re doing before you close on the house. If there are any major repairs, you may be able to get the homeowner to cover them or knock the estimate for the repairs off your purchase price.

5. Not Getting Professional Help

Buying an open house without a qualifies real estate agent is one of the worst mistakes you can make. So if you are seriously shopping for a home, don’t forget to get help from real estate professionals. Real Estate Agents are held responsible for acting on both the seller and buyers best interest. It might not work if you start dealing with seller’s agent, so we suggest you use your own real estate agent so that you can build a long lasting mutual relationship.

The Bottom Line

Buying a first home can seem stressful and overwhelming, and it isn’t without its share of potential pitfalls. If you’re aware of those issues ahead of time, you can protect yourself from costly mistakes and shop with confidence. For many people, a home is the biggest purchase they will ever make, but it need not be the most difficult.

Magna Capital Group, Inc. provides tremendous supports to make your real estate purchase easy. Our staff of mortgage professionals are committed to 100% customer satisfaction. We have extensive experience in placing conventional & private money financing on residential and commercial properties of all types throughout California. For more details or first time home buying tips, contact us today at (310) 734 4044 or email info@magnaloans.com or visit our website www.magnaloans.com