Here’s What To Avoid If You’re A First-Time Homebuyer

First-time homebuyers will feel all sorts of things when buying their very first house: a thrill of anticipation, excitement at the prospect of attaining such a huge milestone, and certainly a good amount of nervousness about successfully securing a good housing loan. Knowing the right steps to take and what to avoid before venturing into the real estate market to find your perfect home can help in making the right decisions. 

Here are some of the things you should steer clear of when buying a house to ensure that you secure your dream home for the best value. 

Things You Need To Know If You Are a First Time Homebuyer

• Spending All Your Savings on the Down Payment. While it is advisable to spend enough on the down payment so that you won’t have to pay for mortgage insurance, draining your savings creates a big risk for your other needs. Consider optimizing your budget before spending on a house. Ideally, you should have three to six months’ worth of living expenses sitting in an emergency fund, even after closing the sale. It’s good practice to spend enough on your downpayment to avoid mortgage insurance, but not at the cost of savings that will help you when the time comes. 
• Deciding on a Home Before Applying for a Mortgage. The excitement of finally owning a home can get to some first-time homebuyers, who end up home shopping before they’ve applied for and secured a mortgage. To keep your expectations reasonable, start with the first priority: securing a first-time homebuyer’s loan. This will create an impression on the lender that you’re a serious buyer with good financial and credit standing to purchase a home, prompting them to help you find the ideal house within your budget more easily.
• Not Branching Out Your Options. Discussing your options with at least three different lenders and mortgage brokers and comparing their lender fees and loan terms will allow you to make a more informed and cost-effective decision. Ensure that you choose a mortgage lender with good service; the last thing you want is for your papers to get stuck somewhere in a pile of applications. Get a mortgage lender who seems intent on helping you close.
• Committing Too Soon. Be ready for homebuying to be a long and complex process. By setting this expectation early on, you can avoid rushing through it, making poor decisions, and committing to agreements too soon for the sake of getting things over and done with. Map out your timeline for buying a home at least a year in advance. Take this time to improve your credit score, save up enough to buy your home, and review the application process steps to get a mortgage loan approved. The more prepared your financials, credit score, and decision-making are, the greater your chances of securing a good home.
• Buying a House You Can’t Afford. It may be tempting to stretch your budget for a home that is absolutely perfect but straying from the limit that you’ve set for yourself may lead to potentially dire consequences later on. Imagine extending your budget to secure the home only to fall into a financially difficult situation later on with the inability to make your monthly mortgage payments. It’s definitely not a situation any first-time homebuyer wants to find themselves in. Focus your attention on the monthly payment that you can comfortably afford. Try to remember that this is the amount you’ll be paying off for the duration of your entire loan, regardless of how much you qualify for. Be transparent with your lender as well regarding how much you can afford, and be conservative with your figures. They should help you find a home that won’t break the bank but can still make for a wonderful living experience. 

Contact a Mortgage Specialist in Florida

As a first-time homebuyer, you may be inexperienced in navigating the market, but by making the necessary preparations, taking your time with the process, and having a reputable lender by your side, securing your ideal home is certainly within the realm of possibility. Being practical with your finances is the best way to secure a good home that won’t hurt your bank account. Remember that this is an investment for the long haul, so make sure that your purchase now can still be securely paid off years into the future. 

Here at American’s Mortgage Solutions, we provide the highest service services to our clients as licensed mortgage originators. Based on your different needs, we have the mortgage or refinance that is right for you. Contact us today at (561) 316-6800 to get pre-approved for a housing loan!