First Time Homebuyers
Mistakes & Tips

Homebuyer Mistakes

  • Don't get the best financing from their lender because they didn't ask enough questions.
  • Lost their dream home to another buyer because they were not prepared to act quickly.
  • Buyers jump at the first real estate agent they meet without interviewing a professional Realtor® to make sure they will look out for their best interest.
  • Low balling their first offer or not making it very attractive to the seller and they lose the deal.
  • A lot of first time buyers will only stay in their home for an average of 4 years so they make a mistake by not considering resale potentials.

First-Time Homebuyers Tips

  • Be excited, but remember this is your very first home purchase so try to be realistic. No home is perfect, but it will be a stepping stone to your financial future.
  • This will most likely be a life changing event and the biggest decision your family has made. It's imperative that you do as much investigating as possible to protect yourself.
  • There's an old expression of "getting your ducks in line". This is particularly true when purchasing a home. Check you credit scores and make sure you have a nest egg of savings to carry you through this transaction. In addition to your downpayment, ask your lender for an estimate of closing cost.
  • You don't want to put off talking to your lender until your ready to put in an offer on your new home. Talk to them as soon as possible to get a pre-approved mortgage letter. Initially they should be able to provide a pre-qualified letter, but that really doesn't hold much weight. A pre-approved letter will give you a stronger position in negotiations with the seller letting them know that you will most likely be able to close on the property they are selling. Start this process early.
  • You'll want to consult the people in your life that you trust the most. Whether their family, friends or associates they'll all want to help. Pick just a few to help guide you in your decision making process. Too many different opinions from too many different directions will just confuse the process.
  • When you submit a contract to purchase a home you will be selecting a closing date to take possession. You need to coordinate this date with your lease agreement and whatever arrangements you have made with your landlord. You don't want to be making a lease payment plus a mortgage payment.
  • Another decision you need to make is the length of time you plan on staying in this first home. Is this a starter home that you will be selling in a few years and moving to something else or is this a perfect home that you plan on staying in for a long time? How you decide will also have an impact on your mortgage. You might want a 5 or 10 year ARM (Adjusted Rate Mortgage) in the short term or maybe it would be better to get a 15 or 30 year fixed mortgage. Check with your lender for the best options for you.
  • Do you plan on painting, decorating or buying new furniture for your new home? Well you need to budget for that expense when considering your price level. It would be nice to get the biggest house you can afford initially, but you don't want to sit in a empty home and not be able to enjoy it. Write down all the expenditures you expect and then make a decision based on the real facts.
  • Of course you're going to be excited about your first home. You should be excited. However, don't skip over the important decisions you need to protect your investment such as insisting on a home inspection before closing on the property and possibly negotiating a one-year home warranty into the contract.
  • You really should secure advice from a professional Realtor® to guide you through this transaction. A real estate agent who has been trained and educated to help buyers specifically has a ABR designation after their name. ABR stands for Accredited Buyer's Representative and they will look out for your best interest. In most cases this professional advice will not cost you anything at all since in a lot of states the commissions for the brokers are paid by the sellers of the property. When in doubt, ask questions.


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