As you get ready to start finding your first home, you may think you are already in good shape — anything you don’t already know, you can figure out as you go along.
However, without a solid grasp on how things work, you may find, after an exhaustive search, that your preferred new home isn’t within your price range — something that can lead to a lot of scrambling and tears.
This means you need to be aware of the common misconceptions out there, ideas a lot of first-time homebuyers have before they’ve gone through the full process. While many of these misconceptions just make the search a little bit harder on you, some can actively cause grief, such as thinking you can put off seeking financing until after you find your ideal home, or believing that you can safely ignore how local market conditions are developing.
1. ‘I Can’t Engage The Selling Broker Agent’
First-time homebuyers overlook the opportunity to engage the selling broker agent to represent them as dual agent to obtain a lower price. This saves the seller from paying full commission to the buyer’s agent and provides better alignment for all parties to complete the transaction. – Babak Ziai, BrandView Capital Partners
2. ‘I Don’t Need To Pre-Qualify For A Loan’
For buyers who will be financing their purchase, which is about half in my market, the first step they want to take is to look at homes. In fact, the best first step is to be pre-qualified for a mortgage. Then they are clear about what they can afford. – Deborah Bhatt, Vesta New York
3. ‘I Can’t Afford This Property’
There are several. Many think they can’t afford the property, and often that isn’t accurate. Also, it’s less of a misconception and more of a mindset, but it all just seems so overwhelming, which causes them to shy away from the process. For a motivated buyer, there are properties that make sense in just about any market. – Keith Robinson, NextHome
4. ‘HVAC Systems Are Not That Important’
Don’t forget the importance of evaluating existing HVAC systems or the path to install compliant HVAC systems. Given the temperature trends, HVAC can be a lifesaver in a household when the heat feels melting. – Owen Fileti, L.A. Realty Partners
5. ‘First, Find The Home’
First-time homebuyers often believe they can save the lending part for later or after they’ve shopped around for their ideal home. What many are unaware of is the power of first qualifying for a loan and being clear on what their limits are before beginning their home search. There is no better indicator of a strong, serious buyer to realtors and sellers. – John Reza Parsiani, Cervera Real Estate
6. ‘Market Conditions Are Irrelevant’
I truly believe the single largest thing that hampers first-time homebuyers is their lack of awareness in the current market conditions. I was a victim of this in 2007 when I purchased my first home at near the peak of the market and proceeded to watch the value of my home decrease 33% over the first two years of homeownership. – Graham Gochneaur, GVG Capital LLC
– Common Misconceptions: What First-Time Home Buyers Need To Know