5 Mistakes First-Time HomeBuyers Make

 Hey, everybody, it’s Janine Sasso and your Chicagoland realtor right here in Schaumburg. And today’s topic, we’re talking about the five mistakes that first-time homebuyers could make when looking for their home. So stay tuned. The first mistake we’re talking about today is solely focusing on your mortgage payment. Did you know that your mortgage payment also entails other things, such as taxes, and homeowner insurance? You’re looking at the association, to do maintenance and repairs. Those are all things you do want to consider when it comes to purchasing a home to make sure you’re not strapped for cash.

Now, the second mistake we’re talking about is looking for the home first and the loan later. I know you hear us preach all the time. Go get your pre-approval. But why are we asking for it? Oftentimes, we need to know where things are at before we look at home. It is really hard to find your perfect home if you’ve been looking at a price range up here. When you budget just a little bit lower, you will find the home purchase process is starting to get frustrating. You don’t see what you found before you can afford and it’s really a backward approach to getting home. So when you sit down with a lender, yes, we know it’s not fun. It’s not fun to talk to somebody about your financials. However, it is so important and it is an important step in building financial wealth. And you should go and do a pre-approval first and then you go and find the home second.

Let’s talk about the third thing that most first-time homebuyers make as a mistake. And this is not to look for professional help. Yes, the Internet has all the information you need. It’s easy to get information on a house and you can just call ahead and get somebody out there to show that house to you without a problem. But will you get somebody that understands what you’re looking for and giving you a direct opinion, keeping you on track with what your goals are when you purchase? Probably not. Chances are, you will also have the listing agent show you the home, the listing agents. Best interest is to make sure you get the most amount of money for his sellers, which is definitely not in your best interest. So what you wanna make sure of is that you have a mortgage professional that you can trust. And he is reputable. From friends. Family. You want to make sure you have a realtor on your side who understands why you are purchasing the home. What’s important for features? Because oftentimes as a first-time homebuyer, while you can get swept up in the beautiful finishes, it doesn’t have a basement. If your criteria was a basement to gain more space, it’s really easy to make improvements down the line. But finding a basement space, not so much. So make sure you have somebody that you trust and that keeps you on track for what your goals were when you first started and set out on this journey.

Now, the fourth mistake we’re going to talk about is using up all your savings for your down payment. Now, the ideal goal for many of us is to put down 20% in order to avoid something that we call private mortgage insurance or short PMI. Now, it is great to be able to put down 20%. However, if this means completely draining your bank account, leaving you nothing in terms of, you know, unexpected repairs, you’re really creating a hard spot for yourself. So weigh the pros and cons. Is it worth it to maybe consider PMI for a short period of time while you’re still building your emergency fund? If you do have enough cash to fund it all, that’s phenomenal. But keep in mind that necessarily this might not be the best strategy. This is why it’s important to get a professional that walks you through this all the way from A to Z.

And the fifth biggest mistake that first-time homebuyers can make if you are under contract for your perfect house, you’ve got your lender that says your loan is almost going to go. You want to keep it this way and do not change your financial history. This is very important when it comes to the home purchase process. You may get moved up in open a new furniture credit card because we need to furnish our house. Do not attempt any of this until you have purchased and successfully closed on your home. This goes for car loans. Just goes for couples. 20% merchandise, credit cards. So if there are any unexpected, bigger expenses, you do want to open something. You make sure you talk to your mortgage professional first because you can make sure if there’s a step up the ball. Or is it something that maybe you can hold off on until the home is closed and your everything is recorded? In certain instances, you know, life happens and you need to pull money somewhere. In this case, talk to your mortgage professional first. See if you can somehow work it out. Wouldn’t influence your loan because life happens. And you do need to sometimes make quick decisions, but a quick line to go somewhere. So in this case, make sure you have this conversation first and come up with a plan before making a rash decision.

So those are our top five. I hope it helps. And if you have a real estate need in the Chicago area, I would love to be your real top choice. And you can always reach me directly at 8477541835. I’ll see you next time.

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