If you’re like most people, buying a house is probably the largest financial transaction you ever make in your life. That’s why you should do it when you are armed with the knowledge that can help you avoid mistakes that you will be forced to live with for the next few decades.
Still, a good number of home buyers aren’t adequately prepared and will often not make the right purchasing decisions. To ensure that you don’t end up joining them, here are some of the mistakes that first time Colorado home buyers often make.
1. Not Doing Proper Research and Planning
For a transaction as large as purchasing a property, research and planning are essential, but people often neglect this primary step in the process. That’s why you should first consider your assets carefully along with your existing debt and then get pre-approved for financing before you ever set out house hunting.
When you start identifying some possible houses, you should then research the neighborhood – things such as property taxes, crime statistics, etc. – and check out the local amenities and school system.
2. Getting the Incorrect Mortgage
Getting the wrong mortgage is one of the most common mistakes that first time Colorado home buyers often make. Unfortunately, it is a mistake that could possibly have a huge impact on your finances for many years.
Will an adjustable rate mortgage or fixed rate mortgage be best suitable for your specific situation? Consider all your options carefully before you ever sign the dotted line and commit yourself for years to come.
Daily Colorado Mortgage Rates for 1.28.22
30 Day Range 2.5% - 3.792%
30 Day Range 2.25% - 2.966%
30 Day Range 2.5% - 3.873%
30 Day Range 2.97% - 3.626%
*Calculated from actual locked rates with consumers across more than one-third of all mortgage transactions closed nationwide
Exceeding the set budget is one mistake that first time Colorado home buyers make that’s most likely to have the most damage on your financial future. It usually happens when rational considerations are overpowered by emotions.
You know how much house you are able to afford since you have done proper research and planning. However, you shouldn’t fall so infatuated with a property that you find yourself buying it even when it is way beyond your budget. In many instances, you can secure the financing, but the reality is that payments and other inevitable expenses are beyond your means.
4. Tipping Your Hands
You must never make the mistake of tipping your hand when it comes to the nitty-gritty of negotiations. The house you have found might be the one you have always dreamed of, but never let the seller know that. Try remaining tight-lipped about your love for the home. Otherwise, the seller will know that he/she is in control and possesses more bargaining leverage.
5. Making a Desperation Purchase
Making a desperation or “fed-up” purchase is the other side of the coin when it comes to mistakes that first time Colorado home buyers regularly make. You might be tired of looking for and touring properties, but you must never give in and make the purchase just because you are worn down. Such a purchase is only likely to land you in a home and neighborhood that you don’t actually like and in which you will be living for many years.
6. Waiving the Inspection
You should never waive the inspection. A home inspection is an absolute invaluable part of the process. Even if it is your first time making such a purchase and you are working on a tight budget and need to cut costs in any way possible, don’t do it by waiving the inspection.
Waiving the inspection might save you a few hundred dollars today, but the problems that you don’t know about simply because you didn’t have an inspection may end up costing you tens of thousands of dollars in the long run.
7. Attempting to Read the Contract Yourself
Contracts used for real estate transactions usually have their own language and complexity that’s only accessible by industry professionals. So, avoid the mistake of trying to read and understand the sales contract yourself. A qualified real estate agent and perhaps even a real estate lawyer are perhaps your best recourse here.
Purchasing a home does not need to be as intimidating as it might first seem, but only if you avoid the 7 mistakes that first time Colorado home buyers make. However, always remember that the tips are just part of what you should know. There’s quite a bit more that you need to know and do, and this is where an experienced real estate professional can be a big help.
Contact us today and see how we can help you get started, 800-599-1563!
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