6 Mistakes You Can't Afford to Make When Buying a Home

posted 4/25/2014 in Mortgage

There are some things in life that don’t require much thought or preparation to purchase: paper towels, batteries, a new light bulb. You buy these things because you need them, they’re cheap and readily available.

On the other hand, a large purchase, like a new home, requires research and preparation. Failing to prepare is preparing to fail, whether it’s not being able to make your mortgage payments or sinking money into a money pit that costs more to fix than it’s worth. Here are some common mistakes to help you through your next home purchase.

Forgetting about all the costs- this is especially true if you are buying your first home. When purchasing, there’s your down payment, principal with interest, property taxes, homeowners insurance, utilities, appraisal fee, credit report fees, escrow fee up front and then any maintenance costs once the home is yours. Plan wisely.

Falling in love with a house- it’s easy to get caught up in all the great things a house has to offer. Stick to your budget and prioritize your needs to keep from straying off course.

Buying a home you can’t afford- a no brainer, right? Then why do so many people do it? Take time to crunch the numbers, and don’t forget those additional costs we talked about!

Making a down payment that is less than 20 percent- do this, and you’re looking at the additional cost of private mortgage insurance.

Skipping an inspection- we know it’s another thing to pay for, but you’ll be thankful if the inspector points out some serious issues you couldn’t see and saves you from investing in a money pit.

Buying if you aren’t staying put- renting is great for those that move around a lot; purchasing a home is not. If you’re buying a home, make sure you’re ready to put down some roots.

As we said, buying a home is a big deal, as are the consequences that go along with not preparing correctly. Our experienced mortgage lenders are here to walk you through the process. 

Lincoln Savings Bank, Member FDIC
Equal Housing Lender

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