If you're looking to become a first-time homeowner, it's easy to get excited, and in the process, get ahead of yourself. There are several financial aspects you must examine when navigating the purchasing process. Here are a few important warnings, or homebuying "don'ts, that you should consider.
Don't delay on getting preapproved. Just because you say you're in the browsing stage of buying a home doesn't mean the home of your dreams won't fall into your lap. If you find a home that you love before you've been approved for a home loan, you may be out of luck. Due to a low inventory of homes across the country, competition is high, so don't delay getting preapproved.
Don't ignore closing costs. Closing costs, which can involve a wide variety of fees, are often forgotten during the excitement of the homebuying experience. Many people focus strictly on the down payment costs when shopping, but escrow, application and inspection fees may apply to you during the closing process. Be sure to budget for these extra expenses.
Don't forget about month-to-month costs. Whether it's normal living expenses or taxes, insurance and homeowner's association fees, you'll be spending money related to your home on a monthly basis. Expenses such as utility costs for water and electricity often get overlooked when purchasing a home. Less essential costs such as landscaping/lawn care are also lurking. So be prepared to research all of these potential monthly bills prior to closing.
Don't try to do it yourself. You may save money buying a home with no professional help, but it can turn into a nightmare. Not knowing the ins and outs of real estate transactions could come back to haunt you if another party takes advantage of your lack of knowledge. Unless you have extensive experience in real estate, the smart move is to always consult a professional to assist you with all facets of buying a home.