Purchasing a property definitely isn’t easy since it requires a substantial financial investment. In fact, with just a couple of small mistakes, you might end up choosing the wrong house and wasting your money. Fortunately, you can prevent your funds from swirling down the drain by avoiding these blunders:
Failing to Save Up Enough Cash
Ideally, when you decide to purchase a house, you should have enough savings to pay at least 20% of the property’s total value.
You can still buy a house if your savings are below the recommended house deposit amount, but you would need to borrow more money and deal with higher interest rates. Keep your costs low by saving up for as much down payment as possible.
Pro tip: aside from paying for the house deposit, you’ll also be required to cover closing costs and other fees. Avoid putting these charges on your credit card (and spending more money) by saving up for them as well.
Refusing to Get the Help of Mortgage Experts
Technically, you can look for the right lenders and mortgage products all by yourself, but you’ll get better deals when you reach out to mortgage brokers.
These experts have a vast network of reputable lenders, and they have access to various products, including first-home buyer loans, self-employed mortgages, investment property loans, and even bad credit home loans.
Inform your broker about your mortgage criteria, and they’ll help you find home loans with decent interest rates and amortisation terms.
Shopping for Homes Without Mortgage Pre-approval
When you find the right lender and home loan, your next priority is to get mortgage preapproval. This way, you’ll know how much property you’re eligible to purchase, and you can focus on finding homes that fall within this price range.
Being pre-approved for a home loan will also make your offer more attractive to sellers since they’re assured that you have the ability to complete the sale.
Not Negotiating for a Better Asking Price
A lot of sellers are willing to lower the total price of their property as long as you’ll negotiate for it. So don’t just take asking prices at face value—instead, speak with the seller and find out if it’s possible to
lower the price down to a more acceptable amount. You can handle the negotiation process by yourself, but it’s best to ask your buyer’s agent to do the leg work on your behalf.
Getting Home Inspections Only for Compliance
Most lenders will require you to schedule a professional home inspection before you can complete the property purchase.
But don’t just get the cheapest and most basic inspection services; instead, choose a comprehensive package that includes in-depth house inspections, pest inspections, and more.
This way, your future home will be thoroughly inspected by a trusted expert, and you’ll know if it has any major issues that require expensive repairs.
If it does, you can halt the sale ASAP and avoid buying a money pit that will put you through financial hardship in the next few years.
Everyone deserves to have a home that meets their needs and provides excellent ROI. Avoid these mistakes to purchase the ideal house while protecting your funds and securing your financial future!
