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What are some of the mistakes first-time homebuyers make?

| Nov 12, 2020 | Real Estate Law

It can be exciting thinking about the prospect of buying your first home. You shouldn’t rush into things without thinking of them as clearly as you should, though. First-time homebuyers often make mistakes that can cost them more money than it otherwise should.

One common mistake that first-time homebuyers make is becoming attached to a home. It’s okay to appreciate a specific neighborhood, but it may be out of your budget, or you may find that you can get something better for your money. Nothing may be available in the neighborhood of your choice, and even if it does, you may have competition for it. If you invest yourself too deep emotionally, then you may be disappointed in the end.

Seasoned homebuyers are mindful of their credit scores. They know to shop around with different lenders. New homebuyers often miss out on Veterans Affairs (VA), U.S. Department of Agriculture (USDA) and Federal Housing Administration (FHA) loans because they’re in a rush to enter a contract to purchase a home instead of exploring what’s out there first.

Another mistake first-time homebuyers make is searching real estate listings before knowing if they have an adequate credit score or meet income requirements to qualify for a loan. They often fail to request a prequalification letter before looking at their first home and don’t stop to find out how much of a down payment they need to have on hand. More seasoned homeowners know to take things step-by-step.

There are situations in which homebuyers qualify for a loan and have an adequate down payment, yet they don’t account for some other expenses along the way. Many new homebuyers fail to add in closing costs, insurance, homeowner’s association fees, maintenance and repair expenses, utility costs and taxes. These expenses can increase your monthly financial obligation.

One of the first steps you’ll want to take if you’re preparing to purchase your first home in Connecticut is speaking with a lender about different loans and any additional monthly expenses you can expect. You should consult with an attorney here in Hartford once you’re ready to sign your purchase contract. They can read over it to ensure that it protects your interests and advocate for you throughout the entire closing process.