First Time Homebuyer Guide to Dodge Common Mistakes
Walking into homeownership for the first time can feel like diving headfirst into a ten-foot swimming pool without knowing how to swim. There are so many aspects of home buying that you don't get to see just scrolling through your social media feed.
Once you get over the initial mindset hurdles of wanting to buy a house and actually get started, you might start wondering how even to begin navigating the deep pool of information that's available. Let's start by explaining the basics of the home buying process.
The first step of your new home is getting connecting with a New Homes Expert. Your expert will help you determine your needs and assist you with finding communities that fit your criteria.
Once you’ve selected the perfect home, your expert will connect you with a mortgage lender for you to get pre-approved for a mortgage.
Most buyers tend to only focus on the mortgage payment. However, most mortgage professionals also include estimates for insurance, property tax, and HOA fees when helping you estimate your budget.
A good loan officer will also assist you with clearing issues with your credit or income, explain the different loan types, and ensure that you know your budget before signing any loan docs.
With these steps in mind, there are still some common mistakes you'll want to avoid to ensure you love your new home and don't hit any major roadblocks along the way.
Not Using a New Homes Expert
Our New Homes Experts are trained to make the home buying process easy and efficient for everyone. They help you navigate listings, educate on communities, negotiate contracts, fill out paperwork, and more. Don't make the process more difficult by trying to tackle everything on your own. After all, they are here to guide you.
Rushing the Process
We understand sometimes people need to make a decision quickly. However, buying a house should be treated more as a marathon and less as a sprint. You don't want to miss out on better opportunities because you took the first home handed to you.
Also, remember that no home will check all of your boxes. Be willing to compromise and prioritize what matters most to you. A house is more than just walls sealed together - it's part of a community. After all, your home's value will rise and fall with its surroundings. Take your time researching different neighborhoods and the style of homes offered within those communities.
Overlooking the Importance of Credit Score
These three digits can open doors as quickly as they can close them. Many people believe they can go back to abusing their credit once they're pre-approved. In reality, a pre-approval is not a fully executed loan. Once you receive the green light on an offer, your loan officer sends your file underwriting, where your credit run again.
If you continue to use your credit responsibly during your home search, you could qualify for better loan products and rates. In contrast, if you've abused your credit, you risk not qualifying for the loan and ultimately losing the house.
Skipping the Home Inspection
You wouldn't buy a car without first seeing how it drives, so don't buy a house without getting a home inspection. Even with new construction homes, there is the potential for mistakes during the construction process that could become a major money pit later down the road. Make sure your dream home isn't hiding any potential nightmares before heading to the closing table.
Forgetting About Closing Costs
We can't bring up the closing table without mentioning closing costs. When you're saving for a house, always factor in the closing costs. They typically range between 2-5% of the loan amount. You should receive an estimate of your closing costs on your loan estimate. Lastly, make sure your funds are in the bank, as most lenders do not accept cash.
Becoming a homeowner for the first time is a significant milestone. We hope this guide will help you navigate the path to purchasing a new construction home more confidently.