Buying your first home is exciting, but it can also be overwhelming. Unfortunately, there are two first home buyer mistakes that I see all too often—and they can be costly if not avoided. The good news? With the right preparation, you can sidestep these pitfalls and approach your home-buying journey with confidence.
Mistake 1: Skipping a Fully Assessed Pre-Approval
One of the biggest first home buyer mistakes is starting the home search without a fully assessed pre-approval. While it might feel tempting to jump straight into open houses and auctions, going in without a solid pre-approval is like shopping without knowing your budget.
A fully assessed pre-approval means your lender has thoroughly reviewed your financial situation and given the green light for your borrowing capacity. This ensures that:
- You know your budget and repayment obligations upfront.
- You’re backed by a lender, so you can confidently make offers.
- The only hurdle left is finding the right property with a suitable valuation.
Without this, you’re essentially guessing, which can lead to unnecessary stress or heartbreak if your dream property falls through.
Mistake 2: Carrying Too Much Debt
Another common mistake first home buyers make is being “top-heavy” with debts and liabilities. Small things like Afterpay, Zip Money, credit cards, car loans, and even HECS debt can quickly add up. These are all considered liabilities by lenders and can reduce your borrowing power.
Working with a broker early on can help you identify and reduce unnecessary debts. This not only strengthens your application but also positions you as a more favorable candidate for pre-approval. At 360 Mortgage Solutions, Tara and I guide our clients through this process to ensure they’re in the best financial position when it’s time to buy.
Avoid These Mistakes with Expert Guidance
First home buyer mistakes like these are avoidable with the right support and preparation. Whether you’re ready to dive in or just starting to think about home ownership, we’re here to help.
Get a head start by joining our First Home Buyer Mini Course, launching this December. This free course covers the essential steps to buying your first home, so you can avoid common pitfalls and approach the process with confidence. Join the waitlist today and get access to an exclusive bonus when the course goes live!