First-time home buyers, beware! By Caylin Harris Updated March 07, 2019
The more experience you have with buying real estate, the more you’ll learn about the complicated process. Between the confusing terminology and the logistics of buying a house, it’s all-too-easy to make the wrong move or wind up in an unwise investment. If you’re a first-time home buyer, skip the buyer’s remorse by learning about some of the most common pitfalls and how to avoid them. To find out what not to do, we reached out to Tracie Rigione and Vicki Ihlefeld, Vice Presidents of Sales at Al Filippone Associates/William Raveis Real Estate in Fairfield, Connecticut, to get their best advice.
1 Not Getting Pre-Approved Before You Shop
The last thing you want to do is fall in love with a house you can’t afford! To prevent that, one of the first things you should do is get pre-approved for a mortgage. “You need to know what you can afford and what the monthly payments look like,” says Ihlefeld. “A good mortgage broker will figure this out for you. And while a bank will usually pre-approve you for a higher amount, you don’t want to overextend yourself. Be realistic about what you can actually afford.” When you go to make an offer on a house, you’ll also be a stronger buyer because you’re pre-approved.
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2 Not Seeking Advice From an Experienced Professional
Even though there is so much information available online, you should still seek the advice of an experienced professional early on in the home-buying process. “Realtors educate people about the process, who they need to
Finding a real estate agent to work with is important, but take your time finding someone who’s a good match for your personality and preferences. As Rigione points out: “You’re going to be spending a lot of time together throughout the process!”
3 Not Making an Informed Offer
A common home-buying mistake is letting your emotions dictate the offer. Instead, only make an offer if you’re really serious about buying a property and make sure it’s based on comparable sales, rather than just how much you like the house. “Ultimately the price should reflect the market value of the home. The ideal negotiation is when the buyer and seller both feel like they’ve won,” says Rigione. “The negotiations between your opening offer and your ideal number is where working with a real estate pro really comes in handy.”
4 Not Being Able to See the House Past Its Appearances
This is potentially a two-pronged issue and both can be problematic. This first scenario is finding a house that is updated with beautiful finishes, fixtures, and is decorated beautifully. “We call it eye candy,” explains Ihlefeld. “People get so busy looking at superficial details and forget about things that they can’t change about the house like the location, the yard, or that it’s on a busy road.”
It can also go the opposite way: Shoppers may overlook a home that needs some paint and cosmetic updates, but that has great bones and a good location. When shopping for a house, keep in mind both cosmetic details that can be altered, as well as those that are expensive or impossible to fix.
5 Making Buying a House an Emotional Rather Than a Business Decision
You never want to fall so in love with a house that you’re emotionally invested in the purchase. “If you love it so much that you feel like you’ll do anything to get a property, you can end up overpaying for the home,” warns Rigione. “That can lead to buyer’s remorse and feeling like you didn’t get the best deal. The buying process is emotional enough, and that’s why you want someone on your side that can keep your emotions in check through the close. We’ve seen deals fall apart from something as small as a missing light fixture!” Stay levelheaded and remember that this is a serious commitment that you’ll have to live with for years to come.
6 Only Looking at Mortgage Rates From One Lender
Make sure you’re doing your due diligence when it comes to your mortgage. You need to speak to an experienced loan officer who will look for the best rates and mortgage products. “Talk to your loan officer about your personal needs so they can help steer you towards the best mortgage for you and your family,” says Ihlefeld. You can save a lot of money that way, especially if you’re a first-time home buyer.”
7 Applying for Lines of Credit or Making Large Credit Purchases.
Buying a house is a big enough purchase, so just focus on that. You shouldn’t be shopping for a car, buying furniture, or opening a new credit card. “Your credit score gets dinged when you open a new line of credit. It can impact your pre-approval, mortgage approval, and create a big mess for the underwriter. It can even delay your closing. Once you’ve closed on the house, then make your next buying decision,” says Rigione.