Hunting for a home comes with a laundry list of best practices and common mistakes. When you’re in the market for a home, it’s easy to get a bit lost in the face of real estate listings, loan options and potential agents and brokers.
We’ve compiled some easy do’s and don’ts to help you navigate the perks and pitfalls of buying a home.
Don’t forget all of the costs. The listed price for any given house doesn’t tell the whole story. Added costs can pile up quickly, with extras like closing costs, homeowner’s association fees and home improvements potentially eating further into your budget. Make sure you take into account the many possible costs beyond the listing price. Work with your loan officer before making any offers to get the full picture of expenses, and how they can fit your budget. Many experts suggest that your monthly housing costs—including mortgage payments, taxes, insurance and other fees—should be no more than 28% of your monthly income. First Tech has a number of mortgage calculators to help you start planning for a loan that fits your budget.
Shop around. Settling on a house before comparing with other listings is risky; you may end up overpaying for your home this way. Get a feel for the home values around the area you are targeting, and track down some sales prices for homes that have recently sold. Even if you are blown away with the first home you view, make sure you keep looking so that you have several options to compare. Your new home is a substantial and lasting investment; don’t let yourself make an uninformed choice.
Don’t get distracted by shiny things. Low interest rates are great to grab your attention, but be aware that there may be other offsetting fees that lurk behind the scenes. Always ask for a cost analysis so you can see the big picture, rather than being distracted by promotions or misleading offers.
Invest in an inspection. It’s always a good idea to organize your own home inspection with a professional of your choosing. Sellers will sometimes include an inspection report for their home, but even then, there is no way to ensure that it discloses every potential issue. Relying on an inspection report from someone you do not know leaves the door open to headaches down the road. Skimping on an upfront inspection could leave you holding the check for costs like roofing, plumbing, foundational damage and plenty more.
Find the right homeowners insurance. Investing in the right amount of homeowners insurance coverage can make a big difference in giving you and your family peace of mind in your new home. Your home will likely be your biggest investment, so making sure it’s protected against unforeseen surprises like water damage, theft and weather-related events can pay off in the long run. To feel confident in your coverage, find an insurance agent who takes the time to understand your unique situation and can build a plan tailored to you. To learn more, read our article on how much coverage you may need.