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5 Mistakes First-Time Homebuyers Make

About 64 percent of millennials have regrets after buying a home. It’s more common for first-time buyers since regular buyers have more experience. The best way to avoid buyer’s remorse is to be careful when buying a house. This article discusses 5 of the most common mistakes that first-time homebuyers make.

1. Not Knowing How Much They Can Afford to Spend

It can take up to 90 days to find a house. You don’t want to zero in on a property only to realize that it is outside your budget. Be smart and know how much you can spend, including the down payment. The 20 percent rule doesn’t apply in every case, and your credit history and financial situation is a major input into a lenders decision on whether to approve your mortgage and for what amount. Therefore, it’s a good idea to work backwards and to first figure out how much of a home you can afford before you go house hunting. This will help eliminate homes that are too expensive and you’ll be able to concentrate on properties that are suitable for you.

2. Not Conducting a Home Inspection

Do not make the mistake of not inspecting a home even if you’re not buying with the intention to live in it. Check the home thoroughly for potential issues such as damaged roof, mold, etc. Not getting the house inspected can result in unexpected maintenance costs that can end up costing you thousands of dollars. It might be a good idea to hire the services of a professional to get the job done. They have the tools and experience needed to identify risky areas and prepare a report for your consideration. Such reports can be used to negotiate a lower price. Plus, even your lender may request that you conduct a home inspection as a condition for approving the loan.

3. Ignoring Programs for First-Time Home Buyers

There are many low or no-down-payment loans, grants, and down payment assistance programs for first-time buyers. According to the law, you're considered a first-time buyer if you "haven't owned your principal residence within the past three years". However, there may be some additional requirements such as income limits. There are both state and federal grants. Check with your agent to find more. As an example, with FHA Loans you can get a down payment as low as 3.5 percent if you have a FICO score of at least 580. Even with a score of 500 it would only go up to 10 percent – many banks and credit unions of all sizes will have a variety of loan options available. Sugar River Bank is a community bank based in New Hampshire, they offer both FHA and USDA loans. In addition, the New Hampshire Housing Finance Authority also administers a Home Start Homebuyer Tax Credit program to help first-time home buyers. Consider these programs and see how you can benefit from them.

4. Forgetting To Make a List of Your Must Have Features

You don’t want to end up buying a house only to realize that it doesn’t offer all that you need. Before you decide to buy a home, sit down and make a list of what you need including the size of the home or the number of bedrooms. Plan for the future since most homeowners spend at least 13.3 years in the same home before moving to a new one. Do not just concentrate on the home itself but also the neighborhood. Make sure it is safe, close to where you work, and has all the amenities one needs to live happily.

Buying a house is a big decision, so make sure to plan in advance and seek professional help to increased your chances of making the best decision possible!


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