Buying a house is a big, expensive transaction. This is a major, life-changing decision that you’ll have to live with for years, if not decades. You can’t leap into it unprepared or ill formed. Before you take the first step, do some research and calculations to determine if a mortgage payment is in your budget. Click To Tweet If you, your family, and your finances are ready to buy a house, learn as much as you can about the process.
Smart people learn from the mistakes of others, so here are some common mistakes to avoid when you’re buying a house:
- Skipping pre-approval. Getting pre-approved for a loan will give you an idea of your likely monthly payment and the price range of listings you should consider.
- Dealing directly with the listing agent. Remember that the listing agent represents the seller and does what’s in the best interests of the seller.
- Not hiring a real estate agent. Home buying isn’t as easy as it looks. An experienced agent guides you through the process, offers valuable advice, handles contracts, and negotiates on your behalf.
- Not researching and interviewing more than one agent. You want an experienced, ethical agent with extensive knowledge of the local market.
- Not asking questions. It’s your agent’s job to answer your questions and solve problems. Don’t be afraid to ask questions if you don’t understand something.
- Failing to research the area. Location is extremely important, so remember to learn about the neighborhood.
- Getting too attached to one house. There are lots of houses out there, many of which will have what you need and want.
- Inability to look past the cosmetic flaws. Remember that many issues can be easily fixed. Don’t let bad paint, outdated carpets or flooring, or ugly window treatments discourage you.
- Overlooking use restrictions. There’s a lot of freedom in homeowning, but it is not always complete. Some properties may be subject to deed restrictions and homeowner’s association rules.
- Failing to save enough money. You’ll likely get a big loan, but there are still closing costs, moving costs, down payment, and taxes. Experts advise saving two or three months’ worth of mortgage payments.
- Failing to read the documents. Read all the documents involved, especially the ones you sign, such as the agency agreement, offers, mortgage documents, seller’s disclosure statement, and inspection reports.
- Not researching homeowners’ insurance costs. Depending on the type of house and location, this could be more expensive than you think.
- Skipping the home inspection. This is a big, expensive mistake. Some condition issues aren’t obvious. You should use the inspection report to request repairs and/or price reductions.
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