5 Mistakes I Made When Buying My Home
Buying your first home is a big deal! You want everything to go perfect, but that doesn’t always happen—at least for me! Check out some of my rookie mistakes, and promise me you’ll do better!
Not having an idea of what I was looking for
I put this first, because this is THE most important thing! I was all over the place when I first started looking, like I’m talking different cities, neighborhoods, the works! When you don’t have a clear goal of what you’re looking for, the home buying process can be extremely draining and confusing. Take the time to really think about what you want and what is going to make your life better. Think of your commute to work, think of where you like to spend your time, what you sacrifice living in one area vs another. Really think!! And be honest with yourself (and your budget!). The more specific you can get, the quicker you can find your new home!
2. Increasing the limit on my credit card
Okay so this is definitely one where I should have known better, and it’s now something that I remind my clients of as soon as we are under contract on a home! DO. NOT. MESS. WITH. YOUR. CREDIT. Do not go buy a new car, do not go make expensive purchases, and please, do not ask for an increase on your credit card!! As soon as you are under contract on a home, you are also under scrutiny by your lender. If you’re going crazy with the credit cards, they are going to think you’re going to engage in financially risky behavior and therefore not be likely (or able) to pay your mortgage. This mistake led to a drop in my credit score, and likely affected my interest rate on my long term loan. Just….don’t do it, okay?
3. Not moving funds on time
It took a while for me to save up for my home, and I just loved seeing my savings account grow as I kept working towards my goal. When I was finally under contract I forgot to do one very important thing: move my money from my savings to my checking. I had submitted an earnest money deposit check but forgot to transfer the money, so the check bounced! It was pretty embarrassing trying to explain to my realtor that I did in fact have the funds and was still planning on buying the house! Not moving funds, or more importantly, wiring funds on time for closing, can delay the process and potentially kill the sale! Make sure when you write a check, someone can cash it immediately (it sounds so silly to even write this out, but what can I say—it happens!!)
4. Not visiting my new neighborhood at different times and days of the week.
My first suggestion would be to try living in your new neighborhood before buying in it, but I know that doesn’t always happen. The next best thing to do is to go there often and at different times of the day (mornings, rush hour, evenings) and on the weekends. This kind of goes back to point number 1 about being specific about what you want. Visiting a home at an open house on a lazy Sunday is vastly different than a bustling Saturday night with way more car/foot traffic. Neighborhoods themselves are not uniform. The more time you spend in your future neighborhood, the better you can understand what parts of it you may want to live in.
5. Not having a plan for breaking my lease
Most of your money will go into buying your new home, so being in a situation where you will be making both rent and mortgage payments is far from ideal! It’s better to first establish your timeline for your homebuying journey and coordinate your housing situation as best you can around that. While that may not always be possible, try getting ahead of it by having a conversation with your landlord/leasing office about different routes you can take once you find yourself under contract. Some landlords/leasing offices offer to find a replacement for you but still make you pay a cancellation fee, or others may allow you find someone to cover the remainder of your lease, at no cost. Bottom line, no one wants to lose money. It’s good to be upfront with them about your plans so that you can work together on saving each other money down the road.
