Posted by Monte Mohr on 11/23/12

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For many of us, our home is the single largest asset we
will ever purchase. Yet people routinely spend less time
researching a home purchase than they do when deciding
which car to buy. But you must remember that a house is
more than your home, in all likelihood it’s your greatest
long-term investment. There are plenty of instances
throughout the buying process when you can make mistakes;
mistakes that mean the difference between financial
stability and a life of debt. Below are four places where
you can avoid a critical misstep in the home buying
process:

Not Understanding How Much You Can Afford Most of us will
need to borrow money to buy a house and that means we’ll
make monthly mortgage payments. A lot of people assume they
know how much they can afford, but you really need to get
preapproved for a loan to have a strong sense. Preapprovals
are great, but if we learned anything from the subprime
mortgage crisis, we learned that just because a bank says
you can afford it, it doesn’t mean you’re comfortable
paying that amount. For this reason it is critical that you
thoroughly review your budget to identify your comfort zone
with monthly payments for the next 15 or 30 years. If you
don’t figure out how much house you can comfortably
afford, you could easily find yourself attached to an
impossible dream.

Not Budgeting For Additional Expenses In addition to
monthly mortgage payments homeowners are responsible for
much more. Part of owning a home is paying annual property
taxes, annual homeowner’s insurance premiums, and the
cost of any repairs or upgrades the house needs. When
compared to your days as a renter, you will also notice an
increase in utility costs. And depending on where you live
there may be monthly (or yearly) maintenance costs paid to
a homeowner’s association.

Not Thinking About Resale Value Always buy with selling in
mind. When you’re looking to buy a home, chances are that
the selling process is the farthest thing from your mind.
That’s because most times when we buy a house our
intention is to stay there. But don’t forget that this
house is a long-term investment and life is full of
unexpected things: illness, loss of a job or a job
transfer, and divorce to name a few. All of these things
can create financial hardships which affect your ability to
pay your mortgage payments. So as you’re looking to buy a
home, remember to think about the ease in which you can
resell it in the future.

Skipping a Home Inspection Have you ever watched the movie
“The Money Pit”? Nobody wants to get stuck with paying
for a lot of unexpected repairs. The best thing to do is
keep your emotions out of the deal until you’ve hired a
professional inspector to verify the house's physical
condition. Sellers won’t tell you about poorly insulated
walls, but an inspector will.

The home buying process isn't without its share of possible
pitfalls. But if you can spot the danger zones, you can
avoid making costly mistakes that will jeopardize your
financial future.

Franklin Tennessees' Top Realtor

4 Rookie Mistakes to Avoid When Buying a Home, 11/23/12, by Monte Mohr.

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