Buying your first home is an exciting experience in anyone's life. Whether you're 20 or 50, married or single, by yourself or with four kids, it's a milestone that you're not likely to forget achieving no matter what. However, it is easy to get caught up in the excitement of finally owning your own home and make several mistakes that you could end up regretting down the line. If you're looking to buy your first home and want to know what common pitfalls you should avoid, keep reading.
With as many websites dedicated to real estate that exist these days, it's easy to just go online and look at houses for hours upon hours. This makes it easy to fall in love with a house without really looking at the price tag. What can happen if you go house-shopping before getting together with a mortgage professional or even just figuring out your budget, is you can end up looking at houses that are out of your price range, either on the high end or the low end. While looking at houses that are cheaper than what you can afford isn't always necessarily a problem, looking at houses that you can't afford is. You'll end up wasting your time and being heartbroken when you discover the perfect house is just outside your price range. So it's a good idea to sit down and figure out what your budget is, and then get together with a mortgage broker and find out what kind of loan you can get preapproved for before you start house shopping.
A down payment is a large sum of money that you bring to the table to show potential lenders that you won't be a risk if they lend you the money to buy your dream home. Having this money to put down shows that you're reliable, that you have the means to continue paying your mortgage and won't lose them money. Though the amount that you will need to put down varies based on different factors, many homeowners regret not putting down a larger down payment. It is generally understood that the larger the down payment that you make, the smaller your mortgage payments will be every month, so it's usually better to aim to have a larger amount saved up, instead of a smaller one.
Though you want to use as much money as you can for your down payment, you don't want to leave yourself with nothing in the bank after you've made it. This is because you also need to think about closing costs, about moving costs, and about any repairs you will need to make to the house. We know it's not fun to think about the house you just bought already needing repairs done, but the truth is things break, and you might need to fix something sooner than you would hope. It is better to still have money in the bank to take care of these things, rather than spending everything on the down payment and not having anything left over for anything else.
We know it's better to have a larger amount of money to put down, we also know that's not always possible for some who still want to purchase a house. What a lot of people don't think to look into is the different loan programs that exist that make it possible to get a house even without a large down payment. There are loans for people who have served in the military, loans for people who want to live in more rural areas, and loans specifically for people who don't have a large down payment. These different types of loans require little to no down payments, depending on which one you're looking at and whether you meet certain criteria. These are avenues well worth looking into, but that are often overlooked by first-time homebuyers who might not even know these loans exist.
Buying your first home should leave you excited, not stressed over mistakes you might have made in the process of getting there. We're here to help you with that process in any way that we can. Whether you are considering buying now or 6 months from now, get in touch with us today if you're in the market. We can't wait to meet you.
