Buying a house is a big step for first-time homebuyers. It’s likely one of the biggest purchases they’ll ever make in their entire life, so every decision can mean the difference between financial stability or bankruptcy. Others who are smart enough apply for mortgage loans to move forward with the home buying process.

Needless to say, first-time homebuyers are prone to making mistakes when entering the housing market. If you’re not careful about your choices, a lot of factors can throw you off track. These mistakes range from minor to costly ones, but a great deal of them often end up buying the wrong properties that don’t suit their budget and lifestyle.

Buying a starter home involves a lot of big decisions, so it’s natural to feel a mixture of emotions at the same time. It’s easy to get overwhelmed by the booming housing market, leaving you to committing mistakes that come with serious consequences. In this article, we’ll discuss the common pitfalls first-time homebuyers often face and how you can avoid them.

Shopping for a home before a mortgage approval

Searching for your first home can be both taxing and exhilarating, so it’s not surprising why some first-time homebuyers are making impulsive decisions on the get-go. But shopping for a house without a mortgage pre-approval can lead you to big trouble.

A mortgage pre-approval comes with many advantages. It puts you in a better financial position to buy a home and provides an idea of how much you can afford on your first home. Having financial stability will also put the seller and agent at ease knowing you’re a serious client.

Shopping for a home before getting approved can be quite risky. Imagine finding the dream house you’ve always wanted but beyond your budget range. This approach will either force you to buy a home more than you can afford or have a hard time finding a home within your budget range.

Finding homes before knowing your actual budget range can ultimately ruin the entire home buying process before you even start.

We understand how exciting it is to go house hunting, but it’s important to get a better hold of your finances. Be sure to have enough savings for the closing costs and down payment, and get a pre-approval from a reliable mortgage company.

While waiting for the approval, list down your priorities when looking for your ideal home. Instead of wasting your time attending home tours and checking home listings, devote your time writing down your dream home’s must-have features and deal breakers. You’ll find the list useful after getting the pre-approval and shopping for homes within your price range.

Working with only one mortgage lender

Applying for a mortgage involves a lot of work. Getting a quotation from the lender requires you to devote some time to provide the needed documentation and discuss the matter with the loan expert. The amount of commitment forces a lot of homebuyers to stick with one lender who can quickly offer them a complete quote. The truth is, putting convenience first can cost a lot of money in the long run.

Sticking to one rate quote leads to a number of missed deals. Every lender has different closing costs, interest rates, and fixed fees. Requesting quotes from multiple lenders allows you to pick the best option that can save you a lot of money over the loan’s entire lifespan.

When shopping around, make sure to get at least two or more quotes from different lenders. This will help you determine which offer fits your budget, allowing you to score thousands of savings. But don’t just approach any lender to reach that number — be sure you’re willing to work with the lender whoever you end up with.

Overlooking loan programs for first-time homebuyers

Many people are unaware of the existence of grants and loan programs for first-time homebuyers while others who have heard of them assume they won’t qualify.

Grants and loan programs help first-time homebuyers secure their homes according to their financial capacity. This type of financial assistance can help you draw closer to the starter home you’ve always wanted. All you have to do is coordinate with the local government in your city or state.

As a first-time homebuyer, you want to make sure your decisions are right on track. Thus, it’s important to be careful on your next hunt for that dream home. Buying a property is a huge investment so use all the time you have while taking a lot of lessons along the way.