Main Content

Hidden Financial Traps for First-Time Homebuyers to Avoid

Hidden Financial Traps for First-Time Homebuyers to AvoidThe home-buying process is not just finding the right house, but the financial end can be overwhelming. So keep these tips in mind to help you avoid traps a home buyer can make:

  • The all-important first step is to ensure your credit is in good standing before going to a lender.
  • Being pre-approved for a mortgage does not impress many sellers, so it is important to be pre-qualified. Talk to different lenders to line up the best deal for you and your budget.
  • Do not overestimate how much you can afford. Avoid properties on your initial search that are dreams homes. The pre-approval process will offer a reality check because your approved mortgage amount is set.
  • Applying for a loan for a new car, credit cards, or even new furniture to go in your home can hurt your credit score during the mortgage process.
  • Buyers often make the mistake of assuming that all of the closing costs are included in the loan amount, which is not the case. Closing costs, on average, are 2-5% of the purchase price of the home, and there is earnest money and a down payment to be made.
  • Do not let your finances deter you from buying a home! While the process may take more time, several programs are ready to assist first-time home buyers. Most require less than 20% down. Other programs provide financing for those who live in rural areas and those with credit issues or lower income. Go to Housing and Urban Development (HUD) for a list of available programs.

You might also believe that it will cost out of pocket to have a RealtorⓇ represent you as a buyer’s agent. Not true! The seller pays the fee from the home purchase on the seller’s end of the transaction. Your agent will guide you along this winding path but will do all they can to lead you to the house at the end!

Jim Coen is Communications Director of the Hickman-Coen Home Team at William Raveis Real Estate. The Hickman-Coen Home Team is a team of highly experienced, locally-focused Realtors and marketing professionals committed to helping you achieve your real estate goals. We provide exceptional service that will exceed your expectations. You will benefit from our knowledge and expertise by making the process of buying or selling seamless, stress-free, and enjoyable.

As long-time Bostonians, Karen & Barry Hickman and Helen and Jim Coen, the Hickman-Coen Home Team members are knowledgeable and well connected to the neighborhoods of Greater Boston.

You deserve professional real estate service! You obtain the best results with the Hickman-Coen Home Team, plus you benefit from her marketing skills, experience, and ability to network with other REALTORS®. Your job gets done pleasantly and efficiently. You can make important decisions easily with fast, accurate information from us.

Know the Numbers

Preparing to Buy

5 Common Mistakes Home Buyers Should Avoid