With so much thought, it is not surprising that some new buyers make mistakes that they will later regret. These are some of the most common pitfalls and tips to help you avoid a similar spell.
1. Do not budget for closing costs.
In addition to saving for the down payment, you need to budget the money to close your mortgage, which can be important. Closing costs are generally between 2% and 5% of the amount of your loan. You can look around and compare the prices of certain closing costs, e.g. B. Homeowners insurance, home inspections, and title searches. You can also pay the fees by asking the seller to pay part of your closing costs or by negotiating the commission from your real estate agent. Calculate your expected closing costs to define your budget.
2. Don’t save enough on costs after moving
Once you’ve saved up for your down payment and budgeted for closing costs, you should also book a steamer to pay for what’s going on in the house. This includes furniture, appliances, rugs, updated fixtures, new colors and any improvements you would like to make after you move in.
3. Buy a house for today instead of tomorrow
It is easy to see which properties meet your current requirements. However, if you are planning to start or expand your family, it may be better to buy a larger house as it grows. Consider your future needs and wants and determine if the home you are considering is right for you.
4. Don’t miss the opportunity to negotiate
You can negotiate a lot when purchasing your home, which can result in huge savings. Are there any major repairs that I can request from the seller, either by treating them entirely or by granting you a loan adjustment at closing? Is the seller ready to pay the closing costs? If you are in a buyer’s market, the seller can negotiate with you to remove the house from the market.
5. Not knowing the limits of a home inspection.
Once your offer is accepted, you pay for a home inspection to examine the interior and exterior condition of the property. However, the results won’t tell you much. Not all inspections are checked for radon, mold or pests. So make sure you know what’s included. Make sure the inspector has access to all rooms in the house, e.g. B. the roof and accessible rooms. Take part in the inspection and pay close attention to it.
6. Do not take out sufficient home insurance
Before closing your new home, you need to purchase home insurance from your lender. Compare prices and insurance rates to find the best price. Look carefully at what the guidelines cover. Choosing a cheaper policy usually means less protection and more expense when you make a claim. Flood damage is also not covered by home insurance. If your new home is in a flood risk area, you may need to purchase separate flood insurance.