Top Mistakes First-Time Homebuyers Make (And How to Avoid Them)

Buying your first home is exciting, but it’s also easy to make costly mistakes along the way. To help you navigate the process smoothly, we’ve rounded up the most common pitfalls first-time buyers face—and how to avoid them.

1. Not Checking Your Credit Score Early Enough

The Mistake: Waiting until the last minute to check your credit score, only to find errors or a lower-than-expected number that affects your loan options. How to Avoid It: Pull your credit report months in advance and dispute any inaccuracies. If your score is low, work on paying down debts and making on-time payments to boost it.

2. Skipping Mortgage Pre-Approval

The Mistake: Falling in love with a home before knowing how much you can actually borrow. How to Avoid It: Get pre-approved before house hunting. This helps set a realistic budget and makes your offer more attractive to sellers.

3. Not Considering All Homeownership Costs

The Mistake: Thinking your mortgage payment is the only expense, forgetting about property taxes, homeowners insurance, maintenance, and HOA fees. How to Avoid It: Factor in all potential costs when budgeting. A good rule of thumb is to set aside 1% of the home’s value annually for maintenance.

4. Not Shopping Around for the Best Mortgage Rate

The Mistake: Taking the first mortgage offer without comparing rates, which could cost you thousands over the life of the loan. How to Avoid It: Get quotes from multiple lenders and negotiate for better terms. Even a slightly lower interest rate can make a big difference.

5. Letting Emotions Lead the Decision

The Mistake: Falling in love with a home and overpaying or ignoring red flags like needed repairs or bad location. How to Avoid It: Stay objective and stick to your budget. A home should fit your needs and your financial goals.

6. Making Big Purchases Before Closing

The Mistake: Financing a new car or racking up credit card debt before your loan closes, which can change your debt-to-income ratio and derail your approval. How to Avoid It: Wait until after closing to make major purchases. Keep your finances stable to avoid any last-minute loan denials.

7. Ignoring First-Time Homebuyer Programs

The Mistake: Not taking advantage of grants, tax credits, or special loan programs that can save you money. How to Avoid It: Research federal, state, and local first-time homebuyer assistance programs. You may qualify for down payment help or reduced mortgage rates.

8. Waiving the Home Inspection

The Mistake: Skipping the home inspection in a competitive market to make your offer more appealing, only to discover costly issues later. How to Avoid It: Always get an inspection. If necessary, negotiate repairs or ask for seller concessions based on the findings.

9. Underestimating the Importance of Location

The Mistake: Buying in a less-than-ideal neighborhood just because the price is right, only to regret it later. How to Avoid It: Consider commute times, school districts, amenities, and future resale value. A great home in a bad location can be a bad investment.

Final Thoughts

Buying your first home is a big milestone—make sure it’s a smart financial move by avoiding these common mistakes. Take your time, do your research, and surround yourself with trusted professionals to guide you through the process.

Have questions about getting started with your mortgage? Let’s chat!