Biggest mistake first time home buyers make and how to avoid it.

Gita, We get calls from buyers not knowing what they want and not knowing what they can afford...BIG Mistake!

Agreed; there are 2 numbers a buyer must know: what a lender will lend, and what they feel capable of repaying.

Gita, Buyer need to read this and take your advice. It will work well all across the country.

SOOOOOOO much available information on-line, buyers know EVERYTHING, almost offended when you recommend getting pre-approved prior to looking at homes.

It's really become evident that people choose Realtors by the amount of info each posts and how often they're seen popping up on the internet. And, immediacy is the new norm. Consumers look and look and look on-line. Then, one day something causes a stir in their bosom and they contact that Realtor. Statistics are everywhere trying to support this or that best Realtor practice, but really, you've got to be active, visible, relevant, and pleasant - and a lot of those efforts are best shown via an on-line portal like ActiveRain.

This is something that many buyers don't consider.  I can see buying at the top of the food chain if the buyers are going to have upward mobility in their job/career horizons.  Sometimes it's a good move to over-buy (at the current market) and grow into the home.  Saves a resale a fews years later.

Hello Gita,

Good post - buying more than you can afford is a buyer no-no, and a recipe for disaster down the road!

Gita, we see buyers often think they can buy more than what they are qualified for.   Usually after showing 10 homes, they get it.

Gita,

I love your post. Simply put, buy a home you can afford. 

The first time home buyers I have worked with for the last year or so have been the opposite in our market.  They can afford more, they don't want to pay more.

So true, get pre-qualified and be realistic on what your money can buy.

Awesome post.  Getting pre-qualified is very important so that you do not go out there and waste their time looking for stuff that they cannot afford.  

Also I think another important item you must discuss with your buyer is that they must not go out there and apply for further credit cards or purchase something big that would affect their credit until after the purchase is completed as you might get a surprise when they find a property and go apply for the loan.

Great post and thanks for sharing.  Have a great day.

I can truly identify with the part about the lowball offers. Many first timers will talk to parents or others who bought "back when." They are almost always counseled to go in with bluster and make that low offer, safe in the knowlegde that a friendly round of negotiations will begin until the happy medium price is reached. It, as you say, is not a buyers' market. Sellers will sniff at such offers and either counter with full price or just wait for the more realistic terms to come across from another prospective buyer.

I always tell my buyers to try to go about 10% or more UNDER what they are approved for. This way there SHOULDN'T be a strain each month when they make that Mortgage payment - and they're not dog-cussin' me for "making" them buy that expensive place!!