March 1, 2024
4 Homebuying Mistakes and How to Avoid Them
Are you ready to buy?
If you’re in the market for a new home, avoid these 4 homebuying mistakes to optimize your experience and set yourself up for success. How do you know if you’re ready to buy? Ask yourself these questions to find out if you’re ready to be a homeowner.
1. Sort Your "Must-Haves" from Your "Nice-to-Haves":
- Before diving into the home search, figure out what you truly need versus what would just be a bonus.
- Establish clear priorities to avoid unnecessary expenses and maintain focus during the property search.
- Don’t begin searching for a home until you know more about the features your home needs to have.
- Remember that a home can always be updated or upgraded over time.
- Read more about how to balance your wants and needs as a homebuyer.
2. Budget Like a Pro and Safeguard Your Bank Account:
- Develop a meticulous budget that accounts for maintenance, insurance, and closing costs in addition to the property's purchase price.
- Set a realistic spending limit to guard against unforeseen challenges.
- Prevent overspending whenever possible and adjust the budget to account for actual costs.
- Allocate additional funds, even if only a few dollars at a time, to build up your savings.
- If buying with a partner or spouse, establish a routine finance check-up to help keep each other accountable.
3. Shop Around for Mortgages Like You're Hunting for Bargains:
- Conduct thorough comparison shopping for mortgage lenders.
- Exercise diligence in selecting a mortgage lender by exploring and comparing offers.
- Scrutinize factors such as interest rates, loan terms, and closing costs to secure the most favorable deal.
- Negotiate with lenders to optimize your financial terms and achieve long-term savings.
- Ask a lot of questions!
- Read about what types of income a mortgage lender will consider and other tips for mortgage shopping.
4. Boost Your Credit Score for Pre-Approval Success:
- Optimize your creditworthiness.
- Elevate your credit score, with a particular emphasis on reducing your debt-to-income (DTI) ratio and minimizing credit card usage percentages, before seeking pre-approval.
- Enhance your eligibility for competitive loans which will ultimately save you substantial costs over the loan's duration.
- Speak with a real estate professional or mortgage lender for clarification on what is and isn’t a worthy credit score for homebuying.
- Read more information about how to boost your credit score before shopping for loan rates.
BONUS TIP: Assistance is out there!
- There are a lot of down payment and homebuyer assistance programs available to first-time buyers.
- Some down payment assistance and homebuyer assistance programs consider the qualifications of the buyer and others consider the eligibility of the listing.
- Consistently, more than 74% of the homes for sale on www.onekeymls.com are eligible for some form of homebuyer assistance.
- “First-time” buyers are generally anyone who has not owned a home within the previous 3 years, not necessarily anyone who hasn’t ever owned a home.
- Read more about Down Payment Assistance programs.
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