When you are attempting to buy a house, you are most likely looking to make an investment, buy a home, or both. Chances are, you want to make a good deal; everyone does, so why do some people make dreadful decisions that affect them financially for years to come? Here is a list of five things that can sway you from making good home buying decisions:
Not getting pre-approved before starting the home search.
The first responsible step in buying a home is finding how much you may spend. There is no sense in looking at dream homes if you find out later that you cannot afford them. There are options available when shopping for loan approval; look to banks or mortgage brokers. Do your research first. Make sure your lender has a good reputation and good rates.
This can happen when homebuyers jump on the first thing they see, or when they have been looking for what seems like ages and they just want to get it over with. Don’t settle. Know what you want, be realistic, and be willing to wait it out. If you buy a house you don’t love, it may end up costing you a fortune to get rid of quickly. Not only that, but you will have to pack up and move yet again, and who wants that?
Spending more than you can afford.
Yes, that house may be beautiful, and it may have all the finishes and touches you’ve dreamed about forever, but does it fit your budget? You may love it while it lasts, but those monthly payments you can’t afford will cause stress and even possibly financial ruin. Keep in mind that your dream home is a possibility in the future. Make a plan, get an extra job, save money, but don’t risk your financial future. Again, be realistic.
Miscalculating your ability to fix the house.
Most people like to think they are pretty handy with a hammer, but when reality hits, that is not always the case. If you overestimate your abilities, you will end up spending a lot more money on repairs and remodels than you had planned. That, in turn, will ruin your budget. The whole point of buying a home to fix up is to save and make money, not lose it. Be realistic – do you see a pattern?
Skipping the home inspection.
Most real estate agents will not recommend this, and with good reason. You need to know what shape your future home is in before you attempt to buy it. You may love the antique woodwork, but what if it is full of dry rot or termites? What if the home has old wiring that is not up to code? You need to know if there are structural problems or fire hazards lurking behind the walls. Again, you guessed it, be realistic. If the existing homeowners aren’t willing to fix the problem(s), or at least reduce the price of the home so you can, don’t buy the house.