Buying a first home is exciting and oftentimes that excitement results in some serious mistakes. There are many things to be careful of when purchasing your first home, but some of the most common mistakes can be easily overcome if a buyer pays careful attention to the home buying process. Here are some of the most common first time home buyer mistakes.
Depending on the seller’s broker
First time home buyers often do not realize that they should consider hiring a buyer’s broker. A seller’s broker gets paid only when the home is sold. For a buyer, this might mean they are not getting the best home for their budget and to meet their needs. Hiring a buyer’s broker means that the home buyer has someone working for their best interests and not the interest of the seller.
Poorly thought out budget
When a first time home buyer is approved for a mortgage, they may forget some of the additional responsibilities of home ownership. These include quarterly tax bills, homeowner’s insurance payments, water bills and upkeep and maintenance. These additional expenses can often have a devastating impact on a budget and if not properly planned for can cause a financial hardship.
Failure to plan ahead
When searching for a home, not every first time home buyer takes into consideration where they will be in five years. A couple without children may fail to plan for additional bedrooms for children they may have later, fail to determine how close they are to schools or fail to plan on selling their homes later. These are all things that should be reviewed carefully when purchasing a home so that a first time home buyer is not disappointed later.
While many states do not require that a home inspection be completed before a sale, it is always a good idea to request one when buying a home. Generally, it is a good idea to request an independent inspection versus hiring an inspector recommended by the seller. Inspections can reveal a number of problems including roof issues, heating or plumbing problems or issues with electrical systems.
Offering too much for the property
When placing an offer on a home that you really love, be careful to not offer too much. Generally, selling prices are negotiable and some sellers will even offer concessions. Before you place an offer, make sure that you have included contingency clauses such as “subject to financing” and “subject to inspection” so that you do not wind up with a non-refundable deposit on a property that you wind up not buying. Don’t be afraid to negotiate with a seller if you discover that there are problems that make the property worth less.
There are numerous traps that a first time home buyer can find themselves in if they do not do their homework before placing an offer on a new home. Understanding some of the most common mistakes that a first time home buyer makes can help you avoid problems down the road.