Common First Time Home Buying Mistakes (And How to Avoid Them)

Buying a home for the very first time can be an exciting and exhilarating process. You're pursuing the American dream, providing a home for your family, and hopefully making yourself more financially secure. Unfortunately many first time homebuyers dive in head first and often make a number of mistakes in the process, costing them time and money. Here are common mistakes that first time homebuyers tend to make and how to avoid them.

Not Getting a Buyer's Agent - Everyone needs someone to represent themselves in a real estate action. Don't believe for a second that the seller's agent is your friend and is looking out for you, no matter how nice, honest and professional they seem. You need someone in the business that's looking out for you alone during the transaction. Real estate transactions are very complex and the slightest mistake could end up costing you thousands of dollars. Having a professional on your side will prevent you from making all sorts of mistakes and make sure that everything's on the up and up.

Not Personally Inspecting the Home - More often than not a first time homebuyer will take a quick walk through the house and not ever do any in depth looking around and checking for problems. Instead they rely on the professional home inspector. Buyers believe that that home inspectors are the professionals and that's their job. Even though that's true, a home buyer should always do a thorough inspection themselves to avoid any surprises when they move in.

Not Knowing Who's Responsible For What - Often times homebuyers aren't entirely aware as to who's supposed to be doing what. Seller's agents, mortgage companies, and appraisers aren't working for the homebuyer, but often time homebuyers think those professionals are on their side. Be very aware who's responsible for what, and who's representing who throughout the process. Don't offer any information that could later be used against you to individuals who are not representing you. Often times statements made to professionals not working for the homebuyer can later be used against the homebuyer in the negotiating process.

Listening to the Bank's Estimate of What You Can Afford - When you go into apply for a mortgage, a mortgage company or bank will often qualify you for twice of what you can realistically afford. They want you to take out a bigger loan so that they can make more money in interest off of you. Look thoroughly at your budget and determine what sort of mortgage payment you can really afford. Professional financial counselor Dave Ramsey gives a very good recommendation that your mortgage should not be more than a fourth of your take-home pay.

Ignoring Secondary Considerations - When buying a home, first time homebuyers often fail to take into account all of the other factors besides the home and the lot. Is the home in a good location? How far is it away from the free way? Is the rest of the neighborhood kept up well? How long of a drive is it from your new home to work during rush-hour traffic? What are the school districts like for the house that you're in? Is the city planning any projects that may affect your area? You should answer all of these questions before signing any paperwork!

It's very easy to make mistakes when buying a home, and chances are the first time you're going to make one or two. Fortunately if you know what the most common mistakes are ahead of time, you can avoid them and save yourself a ton of money