7 Common Mistakes to Avoid When Buying a House
1. Falling in love with a house.
You’ve found a gorgeous property. On the outside, it’s almost perfect, you’re already hyped up and ready to just dive in and buy. This is one of the first mistakes homebuyers make. The sad truth is that very many homebuyers tend to fall in love with a house without checking if it is actually worth buying. It’s normal, so don’t worry about it, because buying something as substantial as a house involves a lot of emotions, people often imagine their families inside the house, kids running around, dogs scampering, holidays every year, memories are made in a home, and that’s all well and good. To be an astute home buyer you must not only focus on the romantic idea of buying a new house, but you must also always look at the practical side. In order to know what to look for when buying a house, you must constantly make sure to inspect the property as thoroughly as possible. Insist on getting an extensive look inside the property, ask some key questions like is their mold? Is the interior on par with the exterior? How’s the plumbing situation? Are the floors level? Is there water damage where you can’t see it? As many people can attest, many homes are “botoxed” to look fantastic, and very enticing to would-be buyers. People who bite the bullet on those kinds of houses without checking the real state of the property can end up owning a lemon. These kinds of houses only give their owners grief and after renovations and corrections to a seemingly lovely and almost perfect house, it’ll be costing a lot more in the long run.
Sometimes, even if the property is great, people can still get the short end of the stick by being too emotionally driven when deciding. It’s easy to get too attached to that pretty bungalow and make unwise decisions that may lead to overpaying, going over your budget, or even getting a great house in a not so ideal neighborhood. Remember that the devil is in the details, when it comes to buying your new home; love at first sight won’t do you any good.
2. Not doing enough correct research.
Everybody knows that buying a house is not cheap, so it goes without saying that you need to understand your family’s finances and needs very well. It is very exciting to finally be able to buy a house of your own, but going in blind and being naïve will stop all that excitement dead in its tracks. Be savvy and use some common sense, read up on some first-time homebuyer tips, know how much you really can afford, and stick to it. Make sure that you’re not drowning in debt, because it is never wise to buy a house while riddled with debt. You might want to risk it, but that risk could come with a very real chance of losing your house and everything that comes with it.
Make sure you know if you qualify for loan programs that will help in financing your dream home. There are a lot of loan programs out there that will give you more flexibility in financing your purchase. VA loans, USDA loans, FHA loans and Conventional loans are a great help to buyers. Read up and see if you qualify for them and meet with a professional who can help. Buying a new house should be a happy event for a family, but if proper research is not done it may turn your dream of owning your very own house into a nightmare.
3. Ignoring other costs.
Now you’ve chosen the perfect house, you’re eager to move in, but oops, you forgot all about the OTHER expenses, big mistake. The excitement of owning a new house and moving in tend to blind people to the other costs that come with buying one. Closing costs are often ignored by some buyers, much to their frustration afterward. Why then do most people make this mistake? Well, one of the biggest reasons is that buyers tend to focus their attention more on the down payment because it’s the more glaring punch to your wallet. So, why is ignoring closing costs so bad? Closing costs can be broken down into three major categories. First are the Loan Closing Costs - these includes appraisal fees, interest payments, escrow fees, etc... The second category is Tax Closing Costs - these include any and all property taxes that you might need to pay; transfer taxes, and recording fees. The third category, Insurance Closing costs, includes heavy-hitters like homeowner’s insurance, flood or quake insurance, Private Mortgage Insurance, and title insurance. Now that that’s clear, you can see how ignoring closing costs is one of the biggest mistakes to avoid when buying a house.
Another expense that is often overlooked is the cost of moving to your new house. While it is fun to go move to your new home and start fresh, remember that the moving itself will take a larger chunk out of your budget than you might think. A move of fewer than 100 miles can cost a home buyer about $650 to $1800! Yikes!
Bottom line, don’t just focus on the most obvious expenses like the down payment. Make sure you also account for peripheral expenses like these. If you do, the process with be much smoother and enjoyable.