First time homebuyer? Here are some pit falls to avoid:
Shopping without a home loan Most experienced real estate agents will ask you to get pre-approved with a mortgage lender before you go shopping. Why? This saves them time and proves you are serious, narrows the search criteria and prevents you falling in love with a home you can’t afford. Being pre-approved also puts you in a stronger bargaining position. But… keep the amount you are pre-approved for on the down low. Bargaining tip: You don’t want the seller to know what you can actually afford; you want to tell them how more you are willing to afford.
Ignoring first-time buyer programs Ignoring these opportunities can cost you a lot of money. What are you potentially passing up? Down payment assistance, Mortgage Credit Certificates, Revitalization programs and HUD homes.
Only considering ‘30-year fixed’ rate mortgages Conservative buyers believe traditional 30-year fixed rate mortgages are the only home loans to consider. However, especially for first-timers, hybrid adjustable-rate mortgages that provide a fixed rate for a specified number of years may be better.