5 Biggest Mistakes Made by

First Home Buyers

Source: www.remaxwagga.com.au

1. No or very low down payment

Many first home buyers are taking advantage of home loans. Buyers need to be aware, that yes they can possibly buy a house without a down payment BUT what will this mean for repayments and your finance down the track? Therefore, people that haven’t been able to save for down payments or that have small down payments, this means your monthly repayments will be more and the interest you pay will be larger each year. This is because the mortgage you have is higher and because you are more of a risk to lend money too.

2. DIY home loans

It’s not all about the interest rate and your bank is not the only option. A home loan has a number of technical parameters which you may need in the future. You may need to split your loan, refinance, redraw or offset your tax effective savings against your loan in the future. Ask your broker or consultant to review your financial position, future plans and let the experts find the best loan that suits you not the lender. Are you being realistic about how much you can repay a month? It may be best to factor in some unwanted spending money, as unwanted bills do like to pop up now and again. You don’t want to put yourself in a situation where you can’t afford to live!

3. Professional inspections

If you buy a house, the last thing you want is to see that there are problems which will cost a lot more to repair than you thought they might. Suddenly, your big profit is looking like a small profit, a break-even deal, or even a loss. Ask your consultant to refer you to a registered professional building and/or pest inspection service. You will receive a comprehensive report which you can legally use to break an unfair deal.

4. The right time to make an offer

It is ideal for a person looking for a home to buy in a buyer’s market. When the real estate market is cold, you will find the sellers more willing to negotiate because it is harder to sell a house at that time. Keep in mind when you make an offer for a home, you want to compare prices of other like homes with similar configurations, age and location to the one you want to buy. You also must have a reliable home loan pre-approval in you hands to make sure you will not get caught up with nasty surprises in the middle of a binding contract. If you work along with an expert consultant, you don’t have to worry about the financial or legal jargon as they walk you through, safe and secure!

5. Waiting too long

You need to find the balance between rushing and waiting too long. The property market fluctuates all the time, so if you have found a house the suits all your needs and you have found a lender that is giving you the best loan for what you need, then you should be comfortable in closing the buying process. Once you have most of the important things reasonably ready, then it’s the right time to act. Don’t wait too long for bigger deposit or the best rate or the best house ever, coz the property prices may go up more than you can afford to catch. The perfect time never comes!

www.ParsFinance.com.au