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9 Mistakes First-Time Home Buyers Make

by The Linda Frierdich Group - Century 21 Advantage

 

9 Mistakes First-Time Home Buyers Make

 

Buying a home is a complicated process, as it should be.  After all, the biggest purchase of your life should probably require necessary measures, time, and “getting all your ducks in a row.”  While it may be understandable that the process of buying a home is intensive, this certainly doesn’t help homebuyers navigate the housing or lending markets.  There are many mistakes that can potentially be made by home buyers, and some, in particular, tend to be made by first-time homebuyers.  Between the stress, misinformation or lack of information, and excitement of buying a first home, there are a lot of errors that can be made along the way.  Assembled here are a number of such examples, in hopes that they may get first-time homebuyers to think about these issues and how they may avoid them.

 

 


Not Attempting to Gain a Better Understanding of the Process

 

No one expects a first-time homebuyer to know the ins and outs of the housing and lending markets and processes.  The first thing a first-time homebuyer should realize is that it is okay that they not know everything; in fact, it’s okay to know nothing at all.  There is absolutely nothing wrong with asking questions.  Many first-time homebuyers make the mistake of not asking enough questions during the process of buying  home, for a number of reasons.  Being sure about the processes involved in buying a home help to ensure that a Buyer is truly happy with their purchase in the long run.  Actually, one of the best ways for first-time homebuyers to begin the process of buying a home is assembling a list of questions they have for both the real estate agent and the lender. 


Thinking You Can Do It Alone

 

When in doubt of how to complete a certain task, the best thing to do is consult a professional.  The same is true when someone is looking to Buy a home.  Meet with a few real estate agents and see how they suit you.  If one doesn’t quite click with you, there is nothing wrong with moving on to a different agent.  You should feel comfortable and confident in your real estate agent, because they will be helping you through the process.  It will be a lot more enjoyable if you are paired up with someone with whom you feel comfortable.   Your real estate agent can recommend a few lenders for you to contact, so that you can begin determining which of those individuals you will choose to work with.   It is important that you feel confident in your lender and his or her professionalism, trustworthiness, and abilities.  After all, he or she will be helping you finance your biggest investment.

 

Not Making Your Goals Clear

 

When speaking with both your real estate agent and your lender, it is important that you make your goals clear.  While your real estate agent can help you decide which characteristics of a home are most important to you, you need to be honest and open during these conversations.  Your agent will know the right questions to ask you to help you decide what you are looking for, but only if you make it clear that you need help and don’t know where to start.  Your lender needs to know what your financial goals are to help you decide what kind of loan you should be getting, as well as what price range of home you should be looking for.  It’s not just about what you can afford with your income; it’s about what you can afford with your income and other financial goals, such as saving.

 

Failing to Take Saving into Account when Budgeting

 

What you can afford doesn’t simply boil down to what you are comfortable paying each month when considering other expenses.  You should also be considering planning for your future and saving money when determining what you can afford.  Too often, this aspect of a budget is overlooked by first-time homebuyers.


Not Knowing (or Ignoring) What You Can Afford


The excitement of owning a home often overtakes first-time buyers, leading them to neglect assessing what they can afford, as well as what their budget means to what kind of home they will find.  While it’d be nice if our first homes were all our final homes, and we could afford our dream house right off the bat, that’s just not realistic.  Too often first-time buyers get mixed up in their ideas of their “perfect home” and their “perfect for right now” home.


This concept is also important for first-time buyers to consider for a different reason.  Often, buyers who have never owned a home before realize that their budgets are limited and decide that they will purchase a home that needs a lot of work, a “fixer-upper” and make it their own on the cheap.  Assuming that a fixer-upper is cheaper than buying a move-in ready home is naïve and, often, inaccurate.  Even professionals who know what they’re doing can end up sinking a lot of money into a home that needs work.  If you are considering purchasing a fixer-upper as your first home, make a list of all the projects that will need to be done for you to update the home, do a little research, and start weighing the actual costs.  Don’t forget, also, that most of the time, any single project ends up costing more than expected, because projects usually hit snags along the way.


Failing to Acknowledge that Needs/Wants will Change over Time

 

While it is important that buyers consider that their first home will probably not be their forever home, it is also important to realistically analyze how long they think they will be in their house.  A third-floor condo may be great for right now, but if a Buyer is planning on getting a dog in the near future (while they are still planning on being at that residence), they should be considering the two flights of stairs for every trip outside with their dog. 


Becoming Distracted by Over-the-Top Features

 

It may be extremely cool that a house you looked at has a wine cellar or pool in the backyard.  However, if you don’t have the money to ever have the ability to stock that wine cellar, or if you don’t have the money or means to maintain that pool, neither of those features will retain their “cool” factor.  First-time homebuyers often make the mistake of becoming enamored with special features of a home, even if they are impractical or out of the range of what can be afforded.

 

Not Hiring an Inspector


Even if an inspection is not required by your mortgage lender, get one.  Even if the home is being sold as is, get one.  Even if the cost will come our of your pocket, get one.  Regardless of the circumstances, you should make an effort to know what exact home you are purchasing.

 

Changing Finances During the Home Search

 

Your pre-approval or pre-qualification is considered from the current financial situation you were in when you sought it out from your lender.  The numbers will change if your financial situation changes.  Change jobs, and your qualifications change.  Get a car loan, and your qualifications change.  Take out a line of credit to furnish your new house, and your qualifications change.  Make a late payment, and your qualifications change.  It is so very important, during your Home Search and especially during the period of time between signing a contract and closing on a house, that none of your financial situations change. 


Overall, there are so many things that can be done wrong when buying a house.  Without experience in the process, it’s very difficult to know what to do and what not to do.  That’s why it’s so important to learn all you can and be honest with the professionals you are dealing with. 

 

Did we forget something?  Let us know in the comments!

Questions to Ask Before Buying a House

by The Linda Frierdich Group - Century 21 Advantage

 

Questions to Ask Before Buying a House

 

The process of buying a home is both exciting and stressful.  There are so many aspects that play into your Home Search and eventual purchase.  Hopefully, if you are going through this process, you have hired a fantastic real estate agent who is helping ease some of that stress.  In this process, where tensions can tend to run high, it’s important to not get carried away with any of the stress or the excitement.  Sometimes buyers dismiss wonderful homes due to very minor issues, simply because they don’t understand the details of the problem.  Opposite that, sometimes buyers get so excited about a particular house that they fail to look at it objectively and don’t ask the questions they need to be asking.  Here is a list for those of you who are emotionally driven, because it can be difficult to think of the right questions to ask when you are filled with excitement about a home.

 


 

Can I see the seller’s disclosures?

 

It is very important that you get all the information you can about the home you may potentially Buy.  A seller’s disclosure will have information regarding the safety and details about the home.  No matter how excited you may be about the possibility of buying this home, it’s important that you look at the seller’s disclosure objectively.  It may reveal an issue that should be a deal-breaker for your current circumstances, but you may have a vision clouded by excitement.

 

What are the zoning guidelines?

 

This is important for a number of reasons.  If you plan on adding on to the house, you will need to know what the zoning restrictions are and what that entails for you and your home.  One thing to consider when buying a home and considering the zoning guidelines is the future.  It’s easy to look at your life and what you need at the moment to find a home that will work for you, but you also need to consider where you’ll be in five years, as well as how long you may end up staying in that particular home, on the generous end.

 

For another thing, if you are planning on ever raising animals at the house you are looking to Buy (like chickens, cows, goats, etc), you need to be sure that the home you are buying has the right zoning for that to happen.

 

What home inspections are available?

 

It’s important for you to try and understand all that you can about this home.  Ask for the results of the home inspection, because there may be details of issues that still remain in the home.  Furthermore, if there are any that have been remedied, you may get an idea of any potential problems to arise again. 

 

Why is this home for sale?

 

More than likely, you will get a generic answer, because a Buyer isn’t going to be inclined to tell you if the reason they are selling their home is something that could steer you away from purchasing their home, however, it’s important for you to ask this question nonetheless.  For instance, if the sellers answer that the house no longer accommodates their growing family, you may want to consider how long you may live in this house and if you are likely to run into a similar issue.

 

How old are the appliances?

 

You, as the Buyer, should inquire about any of the appliances being included in the sale of the home.  Find out when they were purchased and whether the seller bought or received a warranty on the appliances.   This may give you some insight into how soon you may have to be spending a decent chunk of change on new appliances, and for that reason, it is very important to ask.  Furthermore, if the seller bought the hot water heater ten years ago, when you move in, you may want to drain the appliance to remove any sediment build-up and to extend the life of the water heater.

 

What updates have been made to the home?

 

Be sure to ask about whether or not the sellers made any updates or improvements to the home and how long ago the updates took place.  These facts can be very helpful to know!  For instance, if the home recently received a new roof, you will have a better idea of when you will need to get the roof done on the house.

 

What’s the average cost of utility payments?

 

Just because you can afford the monthly home loan payments does not necessarily mean that you can afford to pay the bills once you move in.  The monthly living expenses you will encounter once you move should definitely be factors you are considering in your Home Search.  If the house is much larger than your current or last home, you may be shocked at the extra energy required for every day usage.  Also, an older home often is less insulated, meaning that energy bills will go up more than expected during the summer and winter months.  Be sure that the utility bills are within your budget range before you fall in love with a home.

 

What are the annual taxes?

 

The cost of the yearly taxes for a home are even more important to know than the average utility bill cost.  Taxes can end up being a large amount, and it is important to know what they will likely be before you move forward in purchasing the home.  To consider whether or not you can afford the taxes for a home, do the math from last year’s tax bill, which your real estate agent will be happy to provide you with, and break it down into monthly payments.  Chances are, if you are looking into buying a home, you have figured out your monthly expenses and income.  If not, it’s a good time to do so.  Add in the monthly cost of the taxes, and be honest in your consideration of whether that will leave you enough money to be comfortable with.

 

Ultimately, there are so many questions that could possibly be asked before you Buy a home, and they would differ enormously depending on what is important to each individual situation.  However, hopefully this list served as a guide to start thinking about what questions will be important to you.  Don’t ever hesitate to ask your real estate agent about what questions you should be asking, either.  They have a lot of experience in the field, and they want you to feel confident moving forward.

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The Linda Frierdich Real Estate Group
Century 21 Advantage
103 S Main St
Columbia IL 62236
IL: 618.281.7621

138 Concord Plaza Dr
Saint Louis MO 63128
MO: 314.649.0221
Fax: 618.281.4311

Linda Frierdich is the area's premier real estate professional, offering services in St Louis, Kirkwood, Webster Groves, Crestwood, Ballwin, Arnold, Fenton, Oakville, Columbia, Waterloo, Millstadt, Valmeyer, Dupo, Belleville, O'Fallon, Mascoutah, Fairview Heights, Smithton, Ruma, Hecker, New Athens, Edwardsville, Collinsville, Caseyville, Shiloh, Swansea, Monroe County, Madison County, St Clair County, and Randolph County.  Her team focuses on resale homes, new construction, first time home buyers, condos, farms, land sales, subdivisions, lot sales, single family, multi-family, commercial, foreclosures, bank owned property, military relocation, and building. This site offers options to search real estate in Columbia Illinois and other areas. We offer buyer and sellers services second to none!

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