Common Mistakes to Avoid as a First Time Home Buyer
Buying a home requires many steps from start to finish and can be quite challenging. Buying a home is a big decision so not making common mistakes will help make for a better experience. The most common mistakes people make while purchasing their first home are:
1. NOT MAKING A PROPER BUDGET: Buying a house will probably be one of the most expensive items you purchase and most people typically end up with a loan. As a result, you will end up with a monthly payment. So before making any decision, you will want to review your current financial situation and try to re-budget to see what monthly payment works for you. By working backwards, you can easily find out what price range you will fall into for a house and not have to worry about shopping outside of your range. You are setting reasonable expectations for your situation.
2. NOT CONSIDERING RESALE VALUE: When most people buy their first home they don't think about the resale value because they've never had to consider it before and they are excited about the home they just purchased, not about what can happen in the future. A lot can change in a few years, including changing jobs, transferring to another city, and kids growing up and moving out. By considering resale value while buying, you can make it easier in the future if you decide to sell the house.
3. NOT CHECKING YOUR CREDIT SCORE BEFORE TAKING A LOAN: Most people have never pulled a credit report so they are unaware of their credit score. If you have a good credit score, then getting a loan will be fairly easy and you should be able to get a favorable interest rate. When you are ready to start looking at buying your first home, it is recommended to pull your credit report to review it for any errors and to know what your credit score is so you will have an idea of what to expect during the pre-approval process.
4. TRUSTING ORAL AGREEMENTS: Oral agreements will sometimes work, but can be very risky. You will want to make sure any agreement is always in writing so you have evidence of it. You will want to protect yourself against people who want to make a verbal agreement because it can later give them a loophole if they want to back out because they can later claim the agreement was never made since there is no evidence.
5. SKIPPING THE HOME INSPECTION: You should never skip the home inspection. This is your opportunity to have someone thoroughly go through the house and note any defects or issues. Many people skip the home inspection and later discover several defeats that they didn't originally know about when they bought the home. A homeowner can easily hide the defeats from unsuspecting buyers who don't know what they are looking for are only focused on the overall house. By hiring an expert, you will know the property was investigated properly and if anything major comes up, then you may be able to get the homeowner to pay for it or reduce the price.
6. BUYING WITHOUT ANALYZING THE MARKET CONDITIONS: Many people, especially first time home buyers, don't study the market before purchasing a home. The real estate market fluctuates up and down quite a bit, depending on several variables. You will want to try to buy a home when the demand for houses is less so you can get a decent price, also known as a buyer's market. In addition, you will also want to try to find an agent who is familiar with the market and can help you make the best decision. We have been in the Las Vegas area for over 20 years and in real estate for over 10 years. We are both familiar with the market and follow it closely.
7. NOT HIRING A GOOD AGENT: When buying your first home, finding a good agent is very important because they will be able to help educate you about the process and help you with any concerns. We specialize in first time home buyers so we know how to help you and ensure the home you want to purchase will be in the best interest for you. We put our clients first and look forward to helping you find your dream home.
Shawn & Kyle Cunningham
Cunningham Group at RE/MAX Advantage