Tuesday, April 3, 2012

Mistakes people make when buying a first home

There's more to it than mortgage payments

First-time homebuyers have never gone through the stressful experience of buying a home, and they often learn the hard way that making a wrong turn during this process is costly and stressful. Sometimes it leads to a failed deal.
Getting approved for a mortgage, finding the right agent, searching for the perfect home and staying within a budget are some of the challenges buyers must face before they become homeowners.
Here are five common mistakes first-time homebuyers should avoid.

There's more to it than mortgage payments

Many first-time homebuyers decide to buy when they feel ready for a mortgage. But just because they can afford the mortgage payments doesn't mean they can afford to own a home. They have an idea of what their mortgage payment is going to be, but they don't realize there's much more to it.

Property insurance, taxes, homeowners association dues, maintenance, and higher electric and water bills are some of the costs first-time homebuyers tend to overlook when shopping for a place. Keep in mind property taxes and insurance have a tendency of going up every year. Even if you can afford it now, ask yourself if you'll be able to afford the increased costs later. Even though it's your first home, you must think of it as a long-term commitment.

If you have to switch jobs in a year or two and may have to move for the job, you should think twice. Ideally, you should picture yourself living in that house for five to seven years.


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