If you’re ready to buy your first home and want to have a smooth and successful home purchasing experience, avoid these common first-time home buying mistakes.
- Find a good Mortgage Broker
Ask for recommendations from friends, family and co-workers to find the professional that is right for you. If you are looking on-line, read the testimonials provided by their past clients. Everyone’s financial profile is quite different so experience is important to ensure a mortgage approval for you once you find your dream home.
- Find a good Realtor
Like a good Mortgage Broker, working with a seasoned Realtor is a must. Again, ask for recommendations as you want to feel comfortable while searching for your new home.
- Choose a home once you are pre-approved
Before you fall in love with a home, make sure you can afford it. Once you have been pre-approved and have found the realtor for you, then start house hunting.
- Committing to more than you can afford
Don’t become house poor. Make sure you can still enjoy all of the other activities life has to offer while at the same time covering the costs associated with home ownership.
- Don’t buy a money pit
Don’t buy the house with character and nothing else if you aren’t up for the challenge. If a house requires lots of TLC, make sure you have the time and resources to make it a home. Nothing worse than biting off more than you can chew as your home is supposed to be your happy place without a whole lot of stress.
- Don’t fall into endless renovations
Yes, renovations may increase the value of your home, but don’t rush. Overextending your credit to get it all done fast doesn’t always pay off. Take time to make a solid plan and the best financial decisions. Living in your home as is for a period of time will help you plan the best functional changes to the layout.
- Check out the Neighbourhood before buying
It may be the house of your dreams, but annoying neighbours or a nearby industrial zone can be a rude awakening. Spend time in the area at different times of the day before you make an offer to see first hand what the pros and cons are of living there.
- Be aware of what’s involved in the homebuying process
Once a new buyer finds “the” home for them, there are many more hurdles to get through before you are a homeowner and it all seems to happen within a very short period of time. You will be working with the mortgage broker to meet all lender approval conditions as well as your realtor in meeting all of the purchase/seller conditions. This means you will be gathering financial documents as well as meeting with the home inspector. Lastly, the lawyer you want to work with will wrap it all up for you and advise when the keys can be released to you.
- Get a mortgage that fits your budget
Whether you have a big deposit or small, want a fixed or a variable rate, it’s a good idea to complete a budget with a cash flow analysis to determine how much mortgage you can realistically afford.
- Not getting Mortgage Insurance
Having some kind of insurance in place is a prudent decision when taking on a large debt such as a mortgage. Is it something as simple as loss of income insurance to cover in case of layoff or heaven forbid the loss of a loved one? Seek out an Insurance professional to get the best advice and policy in place.