<img height="1" width="1" style="display:none" src="https://www.facebook.com/tr?id=262189827814310&amp;ev=PageView&amp;noscript=1">

Amerifirst blog

Explore our blog for insights on buying, financing, remodeling, and taking care of your home.

Back to all posts

5 Mistakes to Avoid in Your First Year as a Homeowner

First-time home buyers face an overwhelming

array of worries and firsts cas they search for and purchase the right home. Stress levels rise as they strive to receive financing, obtain a low interest rate, find a house that meets their needs and budget, win bidding wars and navigate closing costs.   


Once they have the keys in hand, it’s no wonder first-time homeowners are ready to stop worrying and just do what they want.


Unfortunately, there are potential pitfalls lurking in that first year that will require attention, planning and even worry. Read on to learn about five of the biggest mistakes to avoid in your first year of homeownership.


1) Ignoring Additional Costs

Closing costs may be over and done, but there are still large and small fees and expenses in the immediate future. Naïve and inexperienced first-time buyers shouldn’t assume their mortgage will be their only post-closing home-owning expense.  New homeowners can and should expect to face payments associated with moving costs, homeowner’s insurance or a home warranty, utility fees and property taxes as well as HOA or other dues as applicable.


The above list doesn’t even touch on starter items — tools, cleaning supplies, ladders, light bulbs — that renters either don’t need or don’t need as much of.


2) Not Expecting the Unexpected

A good inspection should alert buyers to current issues, but it cannot always predict future calamities. Damage from healthy trees downed by a strong storm, a two-year-old refrigerator that dies without warning, an older furnace that can’t keep up with record-low temperatures — these problems are difficult, if not impossible, to predict.

A good home warranty or homeowner’s insurance can help protect from unexpected costs. But even the best warranty or insurance can’t cover every imaginable scenario. That’s why it’s important for first-time buyers to budget and save in preparation for the unexpected. That way, when it’s the dead of winter and they need a new furnace, they’re not stuck choosing between heating their home or paying the mortgage.


3) Jumping the Gun on Renovations

Renovating may be the fun part of home ownership, but it’s best to wait at least a year before tackling non-urgent issues, like updating the design of an otherwise functional kitchen or bath. 



The most obvious reason is cost. Although these are two spaces that pay off in terms of home resale value, even partial kitchen and bath renovations come with large price tags. With a savings account depleted by a down payment and a mortgage payment to meet, homeowners would be wise to build their savings before tackling a large project. 

Cost isn’t the only factor. Living with a space before renovating gives owners a better picture of how they actually use the space and what their functional needs are. It is easy to get caught up in the latest design trends and create a kitchen that is magazine-ready but doesn’t function well for your space or habits.


Related: home renovation financing for those who need it now - Guide to  Renovation Loans


 4) Taking on Additional Debt

 First-time buyers are warned against opening new lines of credit or making large purchases immediately before purchasing a house due to the effects those actions have on interest rates and loan approvals. However, buyers should be cautious about taking on additional debt immediately after the purchase as well. 

First-time buyers unaccustomed to making mortgage payments, paying larger utility bills or being responsible for the care and upkeep of their home have enough costs and cares without adding or maxing out credit cards, let alone adding additional car payments or new school loans into the mix. 


As with renovations, take a break from big spending on anything non-urgent. First-time home owners need time for emergency savings to build back up and to make sure they can comfortably meet their mortgage payments. 


5) Making a Huge Lifestyle Change 

Changing jobs, having a kid, becoming a one-income house, trying to start a personal business or even getting a pet can be enough to throw homeowners for a loop. 

First-timer owners have enough to deal with — enough costs, enough unforeseen complications — without adding a new variable to the equation. Allow time to settle in, get used to the new budget, acclimate to mortgage payments and get to know your home, neighborhood, neighbors, etc. before making a big change. 

First-time buyers: Give yourself time to enjoy your purchase and adjust to your new responsibilities. Rushing blindly into further debt can have disastrous results, including jeopardizing home ownership itself.

Get Mortgage Ready


Author Bio: James White is a construction worker and home improvement blogger. Follow him on Twitter @JGtheSavage or onGoogle+. 

image source

Related Posts

Tips to Save on Your Homeowner's Insurance

Home insurance premiums can make up a big chunk of the annual expenses of a family.  Insurance rates change every year, and in many cases the premiums go up. We all know that there are several variables that determine which banks will lend us money, how much insurance companies will charge us for coverage, and what qualifies a buyer. There are four main variables that may affect your home insurance rate:

Home Maintenance Tips for Winter

Sure, spring cleaning sounds great.  However, in reality, tackling a long home maintenance checklist all at once can be overwhelming. Rather than letting it all add up, what if you tackled home maintenance a little each season? Here are some ideas for taking care of your home during the winter months.

Tips for Paying Off Your Mortgage Faster

There are several ways to pay off your mortgage faster and save on interest payments. Even better, not all methods require spending a lot of extra money! Take a look at the list below: Make extra principal payments.  You can pay extra money toward your mortgage balance each month or make a larger, lump sum payment on your principal each year. This reduces the amount due on the mortgage as well as reducing the amount of interest that will accrue. Extra money can also be added to the principal payment from bonuses, gifts, savings and extra earnings. Just remember to make a note on the check for the money to go towards the principal! Make one extra mortgage payment per year. One of the easiest ways to make an extra payment each year is to pay half your mortgage payment every other week instead of paying the full amount once a month, otherwise known as “bi-weekly payments.” With these payments, an extra payment is made so that the total number of payments that one makes adds up to 13 payments in a year rather than the 12 that would have been made with monthly payments. This adds up to significant interest savings over the duration of a mortgage. You also want to make sure that if your lender accepts this kind of payment they will not charge you a prepayment penalty. Also verify that the bi-weekly payments are being applied to the principal amount and not the interest. Otherwise, you won't notice the savings. Reduce your balance with a lump-sum payment. Have you inherited money, earned a bonus or commission, or sold a large item? You could apply that amount to your mortgage’s principal balance. Another option is any time you have a month where you have that third paycheck, apply that to the principal on your mortgage. This will happen twice a year, adding an extra principal payment to your mortgage loan. While paying down a large debt is nice, it's not a requirement. Consider making sure you have enough to work toward other financial goals, such as an emergency fund, before paying more on your mortgage. However, there are many options you can explore that best fit your budget. You can learn more about buying your first home with our Get Mortgage Ready Guide below.


Call us



Get started

Apply online today