Common mistakes by first time home buyers
Assuming foreclosures are great deals.
Just because the previous owner owed $450,000 on a house before the bank took it over doesn’t mean it’s worth that much now. Values have slipped significantly so you may not be getting the bargain you think with a foreclosure. Also, most homes owned by lenders or banks have been sitting vacant for months and may need a good bit of work to get it back in shape. Weigh the costs of fixing up the property against the savings you’ll likely reap by buying a lower-priced foreclosed home.
Not knowing how much house you can afford.
Many novice homebuyers spend a lot of time researching homes — comparing kitchen layouts and backyard square footage — but very little time researching their financing options. One of the first things buyers should do is talk to a qualified lender and get preapproved for a mortgage, Without first figuring out how much house you can afford, you risk falling in love with one you can’t.
Skipping the inspection.
Before signing anything, hire a professional inspector. The seller isn’t likely to tell you everything. Buyers hire their own inspector — independently of the selling real-estate agent — to ensure there’s no conflict of interest. (You can find inspection companies in the phone book, or by doing a simple Web search with your ZIP code.)
