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Four Mistakes for First-Time Homebuyers to Avoid

June 04,2013

Tags: Builder Services, first-time homebuyers, first-time homeowners, Mortgage Tips, Real Estate Tips, Starkey Builder Services, Starkey Mortgage

With mortgage rates at historic lows and homes that are more affordable than they have been in decades, many first-time homebuyers feel that this is the perfect time to join in the real estate market.

Although buying a home should be exciting, it often comes with unexpected financial obstacles. The following are four common mistakes that homebuyers make, along with tips for how to avoid them, according to a recent article by Equifax:

1. Buyers donat know their credit score. | Since most buyers need a mortgage, one of the most important first steps to buying a home are knowing and understanding your credit score, says Walter Molony, an economic affairs media manager with the National Association of Realtors (NAR). Today, lending standards are much more restrictive. Good credit is one of the first things lenders look for a making it a critical factor. Potential buyers can better prepare by taking common sense precautions like paying bills on time and not taking on multiple lines of new credit at one time.
2. Buyers donat understand the pre-qualification process. | To get a better idea of what is actually affordable, buyers should go through a pre-qualification process with possible lenders. This also gives the buyer a leg up on competition in todayas competitive housing market.
3. Buyers are overwhelmed by prices. | Every first-time homebuyer should research average values and real estate prices in the area they want to buy in. There are countless websites that compare home prices, among other factors, in areas across the U.S. According to data from the NAR, nine out of ten buyers conduct online research before contacting an agent.
4. Buyers donat have the right team in place. | Buyers should carefully select a team to help them through the home purchasing process. All real estate agents should be licensed through the state. Some agents are Realtors, who follow the NARas code of ethics. aProspective buyers should choose agents and other real estate professionals based on trustworthiness, knowledge in the market, and expertise. People often learn of such agents through word of mouth,a Molony advises. First, ask friends and family for referrals, then head to the Web to search for real estate professionals. Remember to meet those professionals in person before making a final decision.

To avoid these common mistakes when buying a home, homebuyers will want to understand their finances, do thorough research on the real estate market, and surround themselves with a great team. For more information, please contact Tamra Wade and Partners at 1-855-770-4663 or visit tamrawade.com.

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