Buying a home can be one of the most rewarding milestones for people who are both established and financially stable. What better way to plant your roots, build a family, and foster your individuality than to invest in a home? What some people might not realize, is that there are many hurdles during the decision making process that can impact your life over the next thirty years.
Sounds scary, right? It doesn’t have to be! We’re here to help you avoid the five most common homebuying hurdles so that you can walk into your new home without any unexpected surprises.
Hurdles to Avoid
1. Falling in love at first sight
It’s easy to say, “that’s the one!” after your first stop at an open house. The wood floors, newly painted walls, jacuzzi tub, and crown molding are just so appealing! What more could a homeowner want?
Don’t let these attractive finishing touches end your search. Keep in mind, you may very well find similar features at another home, in a better neighborhood, closer to work, or for a lower price. It’s important to shop around so that you can be sure you’re getting all the features you require in a home. After all, this is perhaps the biggest purchase you’ll ever make.
Shopping around can also give you a sense of the homebuying atmosphere so you can be as educated as possible during the negotiation process. The last thing you want to experience is buyer’s remorse: “What if I’d waited just a little bit longer to see that home on North Street?” you could end up asking yourself.
If you’re still in love with that first home after shopping around, you’ll feel much more confident in your decision to dive in and make an offer!
2. Not considering ALL home expenses
You’re used to the concept of paying for rent and utilities. You spend $900 on rent each month and about $400 on utilities. Owning a home has got to be more cost effective!
While owning a home is certainly a worthy investment, and a smart long-term goal for any Vermonter, it’s important to keep in mind that you will be introduced to additional expenses you may not have anticipated.
You will, of course, be responsible for a mortgage payment and utilities, but you will also need to pay for homeowners insurance, taxes, and even Private Mortgage Insurance (PMI) if you put down less than 20%. What originally looked like $1,200 a month can silently creep close to $2,000. With each compounding expense, you may be surprised to discover that you can’t afford as much house as you expected.
Consider all expenses, not just your mortgage payment, when you are calculating how much house you can afford. This will keep your expectations in check and allow for you to enter the homebuying process fully prepared.
3. Forgetting the home inspection
The home inspection is a vital step of the home buying process because it allows you to bring in an unbiased representative with experience in construction to tell you about any issues in your potential home.
The basement may look fine to an untrained eye, but to a home inspector, they may see any number of issues. For example, they can determine if the basement is likely to flood, if there are structural issues in your potential home, or if mold is present. Their input will provide you with added knowledge and will give you a proper sense of what you’re getting into. Are you purchasing a safe, worry-free home? Or are you about to put a deposit down on a home that needs a new septic system?
The home inspection will answer these and many other important questions before you have any responsibility over the home. It’s possible that a home inspection could save you from several tens of thousands of dollars worth of repairs!
4. Breaking the budget
Let’s say you have $10,000 saved up to put down on a house and you can afford to pay $1,300 each month for your house-related payments.
If you’re thinking of putting all $10,000 down and finding a home that costs exactly $1,300 each month, you may be setting yourself up for difficult financial times–especially after paying your realtor and closing costs!
After purchasing your home, you’ll likely want to take on some fun home projects, such as landscaping, painting, or even something as simple as purchasing furniture. However, if you spend all of your savings just to get into the house, you may not have much left in your pocket for additional expenses. The last thing you want is a home with no furniture!
Set aside a certain amount of money that can be used for miscellaneous expenses so you will have a little extra wiggle room. You’ll thank yourself for the cushion once you’re looking into the furniture store’s window longingly.
5. Not getting it all in writing
In love with that window treatment, ceiling fan, and brand-new stainless steel stove? You may be itching to make a souffle, only to discover that the stove isn’t included in your home purchase.
When it comes to the negotiation process, be sure to get everything in writing, and read the fine print, so that you know exactly what to expect when the previous homeowner moves out. Many people assume that lighting and other fixed home features are there to stay. However, the seller may have other ideas for those items that you weren’t anticipating.
To make sure you’re getting what you pay for, get everything in writing. This will also prevent delays in the closing process. Do your homework upfront and make sure that absolutely everything you can think of is accounted for and in a contract.
The homebuying process can seem daunting, but it doesn’t have to be as long as you go in prepared, patient, and healthily skeptical. You will be glad you did your homework when you are relaxing in your new, safe, furnished home!
Interested in taking the next step?
Start the conversation with one of our mortgage lenders today, or apply for a loan.