10 Costly Home Buying Mistakes You Can Make

July 1, 2022

The number of people buying houses right now is on the rise.

According to the National Association of Realtors, home sales are up nearly 5% from last year. The median price for a home is also up, reaching just over $200,000. Some people buy houses because they think it’s a good investment, while others simply want to own their own home.

One of the best things you can do before buying a house is to get pre-approved for a mortgage. This will give you an idea of how much money you’ll be able to borrow, and it will also show sellers that you’re serious about buying a home. You should also try to get the best personal loan if you can, as this can help you save money on the interest rate.

But keep in mind that you can make a lot of mistakes when you buy a house. Buying a house is a big decision. Not only do you have to worry about the mortgage, but you also have to make sure that you can afford the upkeep and repairs that come with homeownership.

Here are 10 major mistakes you can make when you buy a house:

1. Not getting a home inspection: A home inspection is crucial in order to identify any potential problems with the home before you buy it. Without one, you could be stuck with serious repairs that will cost you a lot of money.

2. Not being aware of your credit score: Your credit score is important when it comes to getting a mortgage. If your score is low, you may not qualify for the best interest rates and could end up paying more for your home than you need to.

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3. Not shopping around for a mortgage: There are a lot of different lenders out there and each one offers different interest rates and terms. It’s important to shop around and compare offers before choosing a mortgage lender.

4. Not getting pre-approved for a mortgage: Getting pre-approved for a mortgage is a good way to know how much home you can afford and gives you an edge when it comes to making an offer on a home.

5. Making a large down payment: You may be tempted to put down a large down payment in order to avoid paying private mortgage insurance (PMI), but this could leave you “house poor” and struggling to make ends meet. A better option is to make a smaller down payment and budget for PMI if necessary.

6. Skimping on your home insurance: Homeowners insurance is important in protecting your home and belongings in the event of fire, theft, or other disasters. Make sure you get adequate coverage and don’t skimp on your policy.

7. Failing to budget for maintenance and repairs: Owning a home comes with a lot of responsibility, including maintaining and repairing the property. Be sure to set aside money each month to cover these costs so you’re not caught off guard when something needs to be fixed.

8. Taking on too much debt: If you have other debts, such as credit card debt, it’s important to pay these off before buying a home. Otherwise, you may find yourself struggling to make your mortgage payments each month.

9. Not having a realistic idea of what you can afford: It’s important to be realistic about what you can afford when buying a home. Just because you’re approved for a certain mortgage amount doesn’t mean you should spend that much on your home. Stick to a budget you’re comfortable with and be mindful of future expenses, such as home repairs and maintenance.

10. Not knowing the neighborhood: It’s important to do your research on any neighborhood you’re considering buying a home in. Look at crime rates, average home prices, and the quality of schools in the area. You want to make sure you’re moving into a neighborhood that you’ll be happy with for years to come.

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