When you are buying a house, it is one of the largest monetary decisions of you your life (usually), so it is something that if you make a mistake on, can burn you badly. Just moving too fast or not taking care can turn that house buying into a nightmare that can cause you pain for many years.
This is one of the biggest things to be careful of, not researching properly. You are buying a house, but there is a lot more to it than just that. What is the location like, what are the schools like, is the area improving or not, is real estate going up or down, are you near where you want to be or is it far from anywhere. Check the crime statistics for the area and talk to the locals about what is good about living there and what is bad.
Going beyond your budget
Almost everyone over-estimates this one. They buy more than they can afford. Before you even start looking at houses, you need to know what your budget is, how much can you put down for a deposit, and how much the bank will approve for a loan you for. If you are serious, it is always a good idea to get pre-approved for a loan from the bank. This will give you a better idea of what you can afford. Pick a price that you are sure, as in absolutely positive, that you can afford with room in the number for emergencies before you even look at a house. Then no matter what, stick to it.
Falling in love
Falling in love with a dream house can make you do less than intelligent things (trying to be politically correct here). It’s fine to love the house, but, after you love it, you need to make sure that every move is done without any emotion. Affording it, inspections, etc. If you bend the money rules you have set for a house you love, then you face to the possibility of losing that house as well as struggling with bills when you didn’t have to. Love can turn to hate pretty quickly.
All mortgages are not created equal. Make sure you do your research and understand the fine points of it. Whether it a fixed mortgage or not. Know how many fees and points you are paying. Know what the hidden costs are. Make sure you go with a reputable company and have some advice from someone, preferably a mortgage broker, that is not part of the transaction.
No inspections or appraisals
Inspect everything, after all, it is your home. Ask as many questions as you want. It doesn’t matter if they give you a hard time about asking, this is a lot of money and your life. Have professionals examine the house for any such things as a pest, termites, etc. Also, get a full appraisal for the house. Not just the one the banks give you or the real estate agent may have. Hire an independent appraiser and spend the money for a full appraisal. It can show you what the house is really worth as well as things you might not have seen in your own inspections. It might also tell you areas that you might need further inspections, such as plumbing or electrical. It will also give you a realistic value of the house, so you can know if you are paying too much or have a great deal. Feel free to keep the appraisal results to yourself if it’s too good a deal.
Very often people are in a hurry, so they take shortcuts. They make a short escrow period, or just sign away their rights buying the house “as is”. We know you are in a hurry and want to move in soon, but have patience, there is no hurry. Make sure everything is exactly how you want it, and you are protected fully. There is nothing worse than signing an “as is” clause and finding out later there is a crack in the foundation.
Buying a house should be a wonderful experience and you deserve the joy that it gives you. Just follow some of the simple rules we have here and it will take you a long way to make it better, and saving you some possible problems.