Rookie Mistakes: Don’t Make These 4 First-Time Home buyer Mistakes
Buying your first home is exciting. Many young people view home ownership as the definitive mark of adulthood, the final milestone on a decades-long journey. And while becoming a homeowner is cause for celebration, you’ll want to ensure you keep your enthusiasm in check just a little while longer. For a while there was a question as to how society would value home ownership. because the Millennials wanted to be mobile and 50% of them grew up in homes that were foreclosed.
Keep a level head and you’ll easily avoid these common mistakes first-time buyers make.
Don’t View Your Home As An Investment
First-time buyers commonly think that they can invest everything they’ve saved into a home, fix it up, and then sell it for a large profit in a few years. However, a home is a fixed asset that can be hard to sell off quickly. Economics professor Art Carden says “for people looking to start an investment, a stock or bond is a better option than a house, as I’ve never had to call a plumber because a mutual fund started leaking.” Chandler AZ, Gilbert AZ and the Phoenix area are generally exceptions to these rules. Even home in Ocotillo can be updated and sold for a profit. I am an Ocotillo Realtor and if you ever want to see any fix up in the area, let me know.
Don’t Skip The Home Inspection
The American Society of Home Inspectors says 10 percent of home purchases happen without an inspection. Quite simply, buyers decide it’s better to save the fee for the down payment – but often, issues arise later that can result in multi-thousand-dollar repair bills. Foundation problems can be especially nasty, sometimes requiring a tear down.
Before signing a contract, make sure you have a licensed home inspector view the property.
Don’t Believe Everything You Read On The Internet
While it’s good to start researching neighborhoods, mortgage terms, and home valuations online, keep in mind that online estimates are just that – estimates. Not all mortgages are created equal, and the many differences between loans can result in significant changes in the overall cost. For example, just because a lender is giving you a mortgage without an origination fee, that doesn’t make it a good deal – you could be paying a lot more in interest rates.
Always make sure you thoroughly check and understand loan terms before signing anything.
Don’t Go For The Most Expensive House You Can Afford
When you qualify for a mortgage, your lender will tell you the maximum home purchase price they’ll fund, based on your annual income as well as your debt-to-income ratio. However, just because you can afford a $500,000 two-story townhouse, that doesn’t necessarily make it a good idea to buy said townhouse. You’ll want to give yourself a cushion in the event that you lose your job, have children, need to pay medical expenses, or go back to school. Typically getting the smallest house in the neighborhood has always been a good idea. This of course is all market psychology.
First-time buyers often make a variety of mistakes when buying a home, but a mortgage adviser can help you to make the right decisions – decisions that set you on the best possible path toward home ownership. Contact your local mortgage professional today to learn more. If you are looking to buy one of the Ocotillo homes for sale, check out the Ocotillo icon on my home page. You can see all of the recent sales and active homes for sale in Ocotillo.