The first time you do something, you’re likely to make mistakes. Unfortunately, mistakes when you buy a home are truly costly. Here are the common mistakes many first-time Calgary home buyers make and how to avoid making them yourself.
Assuming You Don’t Have Mortgage Options
The mortgage market has far more options than the typical first time home buyer knows about. They may or may not know the difference between an adjustable rate mortgage and fixed rate mortgage. They don’t know the range of options regarding prepayment penalties, hybrid mortgages or closing costs rolled into the loan balance. Loans can even be offered when you will need a loan to rehab the house before you can move into it or want to make major changes or additions after you buy it. Don’t make the mistake of assuming your bank or credit union will give you the best rates or the right type of loan for you. Consult with a Calgary mortgage broker to learn about your options.
“It Looks Great, Let’s Buy It!”
Don’t buy a house based on the description or its initial appearance. Too many people have bought a home that was heavily staged and ignored structural problems that were truly costly in the end to repair. Others fell in love with the property and ignored the long drive, noisy nearby roads and other annoyances that made them regret it later.
Another mistake is falling in love with the neighborhood and then ignoring how the property isn’t a fit for you. When you love the location close to the park or transit hub, you may ignore the fact that the house is too small for your family, requires expensive updates and repairs or other issues that would prevent you from buying it if it were located anywhere else. Don’t buy a home if it doesn’t meet all of your critical criteria such as amount of living space, commuting distance and assigned schools.
Yet another mistake is assuming that appearances equal reality when touring the home. That new paint may be hiding cracks in the walls as could the new siding. The new floors could be a way of updating the home to make it attractive to home buyers, or it was done to hide flood damage. Always have the house examined by a home inspector that you’ve chosen, not someone who may be working for the sellers.
Buying More House than You Can Comfortably Afford
Why do we say comfortably afford? Because taxes, utility bills and other associated ongoing costs of living in the home are likely to go up. And they may go up faster than your pay check. Buy a house that gives you a good margin in your budget. This ensures that you can afford the home now and in the future. It also gives you money left-over each month to pay down the mortgage or other bills, save for emergencies and set aside money for retirement. In fact, if you buy a somewhat cheaper home or get a better deal on the interest rate, then you can set aside a small amount of your check each month so you can pay cash for any major repairs or unexpected bills later without having to take out a home equity loan.
For any related inquiries and for seeking information on your next purchase please give me a call, your local Calgary Mortgage Broker, at 403-241-3255