Top 3 First-Time Homebuyer Mistakes
Real estate agents will often share with each other behind closed doors the mistakes made by first-time home buyers, but they typically won't tell their buyer. Oh, to hear the agents talk, they might have tried to warn the buyer, but they say buyers don't listen to them. Or, perhaps buyers believe some other person's advice, like, say, a relative or close friend, over advice from their own agent.
Not every real estate agent wants to use what might be perceived as overly aggressive tactics by being completely frank and straight with a first-time home buyer. They don't want to frighten the buyer or make the buyer so freaked out that she decides not to buy a home. They want to shield their buyers from hard truths that might hurt.
Some agents say buyers need to learn tough lessons firsthand; buyers won't learn unless they make their own homebuying mistakes. Though some agents find this tactic useful, buyers might actually end up blaming the agent anyway.
Mistake #1: Not Listening to the Buyer's Agent
First-time homebuyers might not trust the real estate agent they hired. If that is the case, the buyer should immediately terminate that relationship. Fiduciary relationships are based on trust. There are good agents and bad agents, just like any business. Hire an agent you trust. Once you trust and like that agent, listen to the advice she gives you.
Your buyer's agent wants you to win and wants you to buy the home of your dreams. Every real estate market is different, and your agent might give you advice that you find difficult to agree with or understand. Keep asking questions until you feel comfortable. Your agent is the best person to advise you about any given real estate market. Don't lose the purchase offer because you didn't listen.
Mistake #2: Not Getting a Preapproval Letter
Because newbie buyers have never purchased a home before, they might not realize that market conditions often demand a preapproval letter. Sellers are not interested in showing their home to a buyer who cannot prove he can afford to buy it. A buyer might think he'll get a preapproval letter if he decides to buy the home, but that's backward.
In the time it takes to get a preapproval letter, another already-qualified buyer could swoop in and snatch the home away while the first buyer is waiting for approval. The preapproval letter is not for your agent; it's for the seller. Don't even think about trying to write an offer without it.
Mistake #3: Buying the Most Expensive Home
You don't have to watch HGTV's House Hunters know that buyers often pick the most expensive home. They are incredibly excited when home shopping and can easily get carried away. Buying a home is an emotional decision. It's normal for buyers to want the best home they can possibly afford, but sometimes emotions can overrule financial common sense.
Don't be afraid to buy a home that might have all of the basic requirements as far as configuration and location, but might need a touch of TLC. If you can buy a home a little bit under your means, you'll probably sleep better at night, and you won't experience buyer's remorse. Look for a starter home -- a home that in 5 to 10 years you might sell to move up. Find a truly affordable home, not the home of your far-off future, because most first-time homebuyers have one thing on their side that veteran buyers generally do not: time.