Things You Shouldn’t Do When Buying a Home

By Real Estate June 8, 2016

The last thing in the world you would ever want is to spend a bunch of time searching for a home, finding that perfect place and then not being approved for your mortgage. There are also many common mistakes people tend to make that could make the buying process much more painful than it has to be.

We’re writing this article because we know how stressful it can be to buy a house. In order to make your process easier, we are going to cover the 9 things you shouldn’t do when buying a home.

1) Don’t overestimate your budget.

Ever heard the expression “House poor“? Many homebuyers overestimate what they can actually afford and end up with very little wiggle room financially. Before jumping into buying, make sure you have a realistic idea of the yearly costs involved with owning a home.

Remember, there is your mortgage, property taxes, utilities, insurance and repairs. All of this before you even think about making upgrades. Factor in all the costs and leave yourself some room.

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2) Don’t let your emotions run wild.

Buying a home is one of the biggest decisions of your life. It’s normal to be excited and fall in love with a home. However, try to keep a level head. Falling in love with a home can cloud your judgement or end in disappointment. This can happen if unforeseen issues are exposed in the inspection or if someone puts in an offer before you.

If you don’t find a home…  don’t get discouraged. Home searching can be a lengthy process. It will be worth it when you find the winner.

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3) Don’t talk to sellers about plans for the house.

As much as you are excited to get in and put your personal touch on the home, it’s best to keep this to yourself. Sometimes home buyers meet and get to know the home owners. This is fine, but remember that the current owner will have an emotional attachment to the property.

It’s best not to make them feel like you’re going to come in and completely change the place. If you make conversation with the owners, just keep the conversation light.

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4) Don’t make any large purchases.

 

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5) Don’t withdraw or deposit a lot of cash.

Going further with your financial history, cash withdraws and deposits also play a part in your mortgage approval rate. Large quantities of cash going in or out of your accounts signals a warning sign that you do not have stability. Avoid any sporadic withdraws or deposits of large sums of cash.

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6) Don’t apply for more credit.

The amount you are approved for on your mortgage comes down to your capital. How much money do you have at your disposal? Applying for extra credit increases your debt. This extra debt decreases the amount you will be approved for on a mortgage.

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7) Don’t co-sign a loan.

While a loan may not technically be yours – it will still equally count towards your overall debt. Co-signing a loan can have an impact on not only the amount of your mortgage, but approval rate in general. Avoid co-signing any loans until you have purchased your home.

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8) Don’t finance a car or furniture.

As financing is again a loan, it is therefore debt. Stay away from financing a car or furniture for the above mortgage approval reasons.

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9) Don’t switch or leave your job.

Financial stability is one of the most important factors considered when a bank is approving your mortgage. The key to financial stability is having a dependable income. If you switch or leave your job, often or before applying for a mortgage, this may signal red flags.

If you are thinking about a move, hang tight with your job until after your mortgage is approved.

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In Conclusion

There are many important things to consider when purchasing a home. It is one of the biggest decisions of your life.

In order to ensure that you get the house you want, when you want it, you need to understand and follow those above tips. Doing so will increase your chances of finding that perfect home and getting it. Remember that financials are very important when it comes time to apply for a mortgage. Make that your priority.

Also keep in mind the emotional aspects of purchasing a home and try to stay cool. It can be a draining process, but it will be worth it when you get the keys to the castle!

Are you looking for a home in the area? Give me a call. I’d love to help you find a home (and make sure you make none of the above mistakes in the process!)

About the Author
Joshua Stephens, Vice President

Joshua Stephens is the founder and president of Moving Greater Boston and a Vice President of Berkshire Hathaway Home Services Warren Residential. After graduating from UMASS Amherst with a degree in psychology in 2008, Josh dedicated five years to social service work on the North Shore before joining Berkshire Hathaway in 2013, where he found his professional calling and quickly distinguished himself as a motivated innovator capable of synthesizing the needs of buyers, sellers, investors, and developers. In just a few short years, Josh formed Moving Greater Boston and achieved over $100 million in sales after only 7 years in the business. Josh's team has been consistently recognized at both the local and national levels, receiving numerous prestigious awards for sales and customer service. Last year, the Moving Greater Boston team was awarded the coveted Chairman’s Circle Platinum award for all of Berkshire Hathaway Home Services, which recognizes agents and teams that are in the top 1% for sales across a network of over 70,000 agencies. In 2017, Josh was also personally selected to serve on the Berkshire Hathaway Home Services National REthink Council, an honor bestowed upon only 15 agents among thousands of applicants. Despite his many and ongoing successes in the world of real estate, Joshua has never lost sight of his social work roots. A compassionate and principled professional who knows the value of strong communities, Josh continues his advocacy outside of the office by being actively involved in a number of local organizations and charities. In 2016, he was instrumental in conceptualizing and developing Business Networking International (BNI) Prospect Hill, an organization that connects local business professionals and aspiring entrepreneurs. As a native of Massachusetts, Joshua has an intimate knowledge of Boston real estate, while having a degree in psychology helps him to understand each of his clients' unique needs, enabling him to connect them with ideal communities, an opportunity which he considers both a priority and privilege. Rather than simply facilitating the buying and selling of property, Josh views his role as a realtor as a lifelong commitment to continually serving the best interests of the people who have put their trust in him. Josh continually strives for excellence in service, provides in-depth knowledge of the market, and blends unwavering integrity with amenable good humor to alleviate the stress of real estate transactions and assure the experience is one that lets the sensation of being in the perfect place, at the perfect time, truly resonate.