Mistake #1: Going it alone
Buying your first home is a big deal. It’s a major (really major) financial transaction, and it has a big emotional component too. This is where you’ll live, and love, and shelter your family! So protect yourself by working with a pro, who will help you steer clear of many of the mistakes on this list. A buyer’s agent guides you through the process of how to buy your first home, and typically, you don’t pay for her services (the seller does). In some cities and states, you must be represented by a real estate lawyer; and again, you’ll want and need professional help to navigate the complicated waters of negotiating a deal and financing a home purchase. These are the 15 essential questions for first-time homebuyers.
Mistake #2: Not giving yourself enough credit
You probably know that you’ll need a good credit rating to secure a home loan and that you should check out what your rating is before you start talking to lenders. But many first-time homebuyers don’t realize that it can be worthwhile to delay a purchase in order to boost that credit rating. “Waiting an extra 60 days could improve your credit enough to lower your monthly payment,” says Elizabeth Mendenhall, the 2018 president of the National Association of Realtors and the CEO of Re/Max Boone Realty in Columbia, Missouri. “Talk to a lender ahead of time and find out. It could be worth it to wait if you’ll save money in the long-term,” she says.
Once you do have a loan in place and a home under contract, don’t celebrate too early by taking out a new car loan or charging a bunch of furniture on your credit card. Your lender will re-check your credit report just before closing, and any changes to your financial status won’t be welcome.