First-time home buyer? Don’t make these five mistakes
The chance to get your first foot on the property ladder is a big moment in your life. Here are five mistakes to avoid if you are a first-time buyer.
It is very easy to get excited about becoming a property owner when you check out a popular location called The Highlands, for instance, where you can find some stunning Porter homes for sale.
What you don’t want to do is get off on the wrong foot by making a classic first-time home buyer mistake. Here are some key points to be aware of when you are looking to finance your first property purchase.
1) Don’t wait to get approval
It is always a smart move to start the mortgage approval process as soon as you have decided you are ready to start searching for a home to buy.
Once you have been pre-approved for a loan you are in a much stronger position to be taken seriously as a buyer. When you get initial approval from your mortgage lender it confirms that you are in a position to proceed and how much you are able to borrow.
This will really help when you are making an offer to buy and can demonstrate you are pre-approved and able to finance the deal.
2) Make sure you shop around
It can be really tempting to go with the first mortgage quote you get. It is a competitive mortgage market and that means there could be some better loan deals available.
You should not apply for several mortgages as this could damage your credit rating and chances of getting approved. Shop around for no-obligation quotes and start the application process once you are happy you have found the best deal.
3) Be sensible with affordability
Taking on a home loan is a big financial commitment. If you try to borrow more than you are comfortable with, it could stretch your finances. To better understand how much you can afford to borrow without overstressing your budget, consider using a home buying power calculator. This tool can provide a clearer picture of what loan amount aligns with your financial situation.
The mortgage approval process is designed to align with your income and only let you borrow what you can afford. A lender uses a debt-to-income ratio to work out affordability. However, this doesn’t always account for all of your monthly expenses. Make sure you borrow an amount that you are comfortable with to avoid the prospect of getting into difficulty with your mortgage payments.
4) Always check your credit report before applying
Even if you think your credit score should be perfect and you have no defaults or bad marks against your name it is always a good idea to check before applying for finance.
Don’t take on any more borrowing once you have been approved for a mortgage until the deal has been completed. Your lender will check your report before finalizing the loan payment and any changes could result in a reduced loan offer.
5) Budget for all of your homebuying expenses
There are a lot of additional costs to pay when you buy a home. Make sure you budget for all the additional expenditures such as insurance, moving fees, and all the closing costs involved.
Work out a budget so that there are no nasty financial surprises that could leave your finances stretched.
If you are aware of these tips when you start the mortgage process it should make the homebuying process as smooth and straightforward as possible. Once all of that is sorted you can start enjoying your new home.
