Three Home Buying Mistakes to Avoid

by Kristen White Blogger

It is always a good idea to have a special fund or savings account dedicated to putting money aside for the purchase of a new home. This way, you can afford the down payment and have room to negotiate because you are prepared. However, as important as it is to save, it is just as useful to ensure that debt is paid off for several reasons. First, it increases your credit score because there is a lower debt/income ratio and it shows the bank or lending institution that you can afford a mortgage payment. Higher credit means a lower interest rate on the loan translating to more options you can afford on the market.

The next mistake to avoid is doing the process backwards like searching for a home before you get pre-approved. It’s fun to check out the Dana Point homes for sale online but if you are a serious buyer then the first step should be getting pre-approved so you know how much financing you will receive and what homes fall within this range. Remember that just because you get approved for an amount, it doesn’t mean that you need to spend the entire figure but rather, take a look at the monthly payment amounts to see what you can reasonably afford in the budget. New homeowners get so excited about buying their first house that they forget there are other bills they still need to pay.

A third costly misstep is not taking into account the extra expenses that come with owning a home such as insurance, inspections, repairs, taxes, etc. The financial responsibility is not limited to the monthly mortgage payment but includes all the above items which vary in cost depending on the home’s location, age, condition and other important factors. Laguna Beach homes for sale are beautiful and the perfect solution for someone who wants to live on the beach as their own daily getaway spot but home insurance may require flood insurance due to its location which will be more than a home that is positioned more inland. The best real estate agents will help their clients to keep these items in mind during the process because it can be a major ‘sticker’ shock after the closing when these costs go into effect. Being aware of them ahead of time ensures that they can plan accordingly and truly enjoy their home for its beauty and benefits.

Owning a home is a great investment and provides peace of mind that your family has a stable place they can come to every day but when mistakes are made, the purchase can turn into a financial burden that is not easily gotten rid of. Take time to research best practices and tips for homebuyers as well as connecting with a reliable real estate agent that can find you a home that works within your budget and meets your needs (and wants) in a timely manner. This way you can enjoy coming home to it every day and building it for the future.