Typical Mistakes made by First Time Homebuyers

With the real estate market in a definite time to buy mode, many times we can get caught up in the activity of having to buy right now, at this moment. All buyers, specifically first time home buyers, should take a deep breath and follow the advice noted below.

1st. Know how much house you can afford. Most first time home buyers and novice home buyers spend an enormous amount of time researching homes. However, they spend very little time researching financing options. Before you begin to search for a home, you should call a Prosperity Mortgage representative, and schedule an appointment to go over your income and credit loads. Some lenders do a pre-qualification and others do a pre-approval. I pre-approve clients rather than pre-qualifying them. A pre-approval is much stronger since it tells the seller that you have truly had a person analyze your income records, tax returns, bank statements and credit report.

2nd. Don't assume a foreclosure is a great deal. If a homeowner lost their home and paid $350,000.00 for it, that does not mean it is worth that amount today. Home values have declined, though not nearly as much as other parts of the country, and inventories here in the New River Valley are large. It is certainly a great time to buy. A foreclosure needs to be looked at very carefully. It is to your advantage to have a home inspector or contractor go with you and your REALTOR to preview a property that you have zeroed in on as a potential buy. Many foreclosed properties have sat vacant for many months, with the electricity and water turned off, so you want to insist that the property have its utilities turned on as a requirement of the contract. This is the only way to determine if you are buying a money pit, even at a great purchase deal. Unforeseen problems can push you at or above the initial purchase price, so do your homework on foreclosed properties.

3rd. Do not let your true feelings show. No matter how much you love the house, do not let the sellers agent catch wind of it. Doing so allows the sellers to gain the upper hand and removes your negotiation power.

4th. Find a fantastic buyers agent. Look for agents that make it a practice to work with first time home buyers. These people have a very good working knowledge of what to expect with their clients, and typically are familiar with lending institutions, like Dave Shelor with Prosperity Mortgage, who pride themselves in helping first time home buyers.

5th. Make sure when you talk with a mortgage lender that you leave their office with a very clear understanding of the costs of home ownership. You have to factor real estate taxes, home owners insurance as well as anticipated home maintenance and repairs. All of these things, and then some, are costs to owning a home.

6th. Do not assume that your first offer will be accepted. With large inventories, more and more people are in your position. Look for a deal, and write your offer accordingly. If your offer is unrealistic, even in today's market, it will not be accepted and sometimes, even reviewed. Trust your REALTOR and ask for their guidance in structuring an offer. They are the professionals and can help you write a strong offer.

7th. Don't skip the home inspection. It typically costs about $300.00 give or take, and is well worth the money. Other inspections geared toward radon and structural add a little more, but for a good general home inspection, ask your REALTOR for any referrals. It usually takes a few hours and is one of the most in depth reports that you will receive on your home.

If you are in the market and have not found a good real estate professional to help you find a home, give me a call. After we pre-approve you for purchase, I can help you find someone that will write that offer. I work with some of the best REALTORS in the New River Valley, and would enjoy helping you get into that new home quickly, easily and with great care. Call me today.