Buying your first home is exciting, but it can also be overwhelming. Without the right preparation, small mistakes can lead to big financial stress later on. From setting a realistic budget to understanding the full cost of homeownership, knowing what to avoid will help you make confident decisions.
1. Focusing on Too Much Home for Your Budget
It's easy to fall in love with a home that has more space, features, or location appeal than you actually need or can comfortably afford. Real estate listings, open houses, and online tours can all make “just a little more” seem harmless, but stretching your budget too far doesn't leave much room for savings or emergencies.
Avoid it by:
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Setting a realistic budget that includes all housing expenses (taxes, insurance, HOA fees, utilities, maintenance, etc.) not just the mortgage.
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Using the 28/36 rule (spend no more than 28% of your gross monthly income on housing and no more than 36% on total debt).
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Getting pre-approved so you know exactly how much you can afford and house hunt with confidence.
2. Buying a Home While Deep in Debt
When you're already juggling credit card balances, auto loans, or student loans, it can be tempting to add a mortgage into the mix solely because you don't want to miss out on a property or great rate. However, this thought process can quickly lead to financial strain and limit your loan options (lenders see high debt-to-income ratio as risky).
Avoid it by:
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Taking the time to pay down debts and lowering your debt-to-income ratio before applying for a mortgage.
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Improving your credit score to help you qualify for better rates, terms, and home loan options.
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Not making large purchases, draining savings, or taking on additional debts before you finish the mortgage process.
3. Underestimating Homeownership Costs
It's easy to assume that once you cover your mortgage, you're done with major housing expenses. The reality is that property taxes, homeowners' insurance, HOA fees, utilities, and maintenance can significantly increase your monthly expenses. On top of that, major repairs such as replacing a roof, upgrading an HVAC system, or fixing plumbing issues can come unexpectedly and usually at a high cost. Many first-time buyers overlook these expenses because they're focused on the home's purchase price rather than the total cost of owning a home.
Avoid it by:
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Creating an emergency savings for unexpected repairs and other unanticipated costs.
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Researching average utility costs, taxes, insurance, and HOA fees before you decide to put in an offer on a home.
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Scheduling regular maintenance to prevent small issues from becoming big problems that can drain your budget.
4. Skipping Professional Guidance
Some buyers try to save money by avoiding real estate agents or managing the homebuying process on their own. While it is possible, this often results in overlooked details, weaker negotiations, or missed opportunities for big savings. Professional guidance from a real estate agent and a knowledgeable lender can help you avoid costly mistakes, ensure you understand each step, and protect your interests during inspections, contract negotiations, and closing.
Avoid it by:
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Working with trusted real estate agents or brokers who understand your local market.
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Asking questions at every stage of the process – from showings to application and through to closing.
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Partnering with a lender like Peach State, where you'll receive personalized service from application to closing and beyond.
5. Choosing the Wrong Lender or Home Loan
Many buyers choose the first lender they speak to or go with whoever their real estate agent recommends without shopping around. Others focus only on interest rates without looking at loan terms, fees, or customer service. This can lead to higher costs over the life of the loan or a mortgage that doesn't fit your needs. The wrong type of mortgage or lender relationship can cause frustration, delays, and unnecessary expenses – both at closing and in the years ahead.
Avoid it by:
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Comparing rates, fees, and terms of different home loan options.
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Asking about first-time buyer programs, rate locks or buy downs, and down payment assistance.
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Working with a trusted lender who explains all options clearly and tailors solutions to your needs.
At Peach State, we offer a complete suite of mortgages to fit your needs and budget. From conventional mortgages to those with an adjustable rate, we have options that offer low down payment, no private mortgage insurance, and more! Our Mortgage Team is here to help guide you every step of the way. Contact us today to get started on your homebuying journey at 770.580.6098 or apply online!1
As a first time home buyer, the home buying process can feel overwhelming. For more time and money saving tips, download our "How Much House Can I Afford in Georgia or South Carolina?" guide.
1 Loan applications are processed by Member First Mortgage (NMLS ID# 149532) and are subject to credit approval based on each individual’s credit history and underwriting factors. ARM rates are subject to change after closing. Your Annual Percentage Rate (APR) will vary based on your final loan amount and finance charges.
