Four Mistakes to Avoid as First-Time Homeowners

The excitement of moving into your first home is intense. However, if you make the same mistakes many first-time homeowners make, you could find yourself in a financial bind. Here are some ways to avoid letting that happen.

Are you one of the chosen few who have been able to qualify for a home loan these days at the historically low mortgage rates? If so, you should pat yourself on the back because it’s simply difficult to qualify for those rates with the banks hesitating to avoid worsening the debacle that has become the housing market. But whether or not you qualified for the low rates, even buying a home these days is a feat within itself. Here are some smart tips to help you save money and be a responsible homeowner.

1. Avoid spending too much money on furniture.
It might be tempting to buy all new furniture for your new house, but unless you have a pile of cash sitting around after making your down payment, this is a bad idea. If this is your first home, you are going to experience several more expenses that you may not have been paying before, such as insurance, property tax, water and more. If you don’t save your money for these extra expenses, you could find yourself in financial trouble. Buy furniture and decorations slowly as you have the money and your bank account will thank you for it.

2. Only hire reputable and qualified people to work on your home.
Cutting corners when it comes to remodeling or fixing problems with your new home is a recipe for disaster. Always get estimates from a few contractors for the job that you want done and then research each company or private contractor. Choosing the one with the lowest bid just because of the price could mean more problems in the future.

3. Go to a professional for tax time. You might want to try to figure out how to do your taxes each year as a new homeowner, but you could cost yourself thousands in deductions. If it’s your first home, you probably aren’t aware of all the rules and tax guidelines that are designed to help you. A professional CPA stays current on the new guidelines which is why it is always better to go to a tax professional to maximize your returns and put more money back into your bank account.

4. Keep any receipts related to home improvements. This is important and will make tax time much easier for you and the tax professional you hire. When you make home improvements, you get tax benefits. But you have to keep your receipts to prove how much you spent on those improvements.

As a first-time homeowner, you are going to love the fact that you have your own home that is yours. Just be smart about your finances and you can enjoy the home physically and emotionally as well.

Add your Comment

or use your BestCashCow account


Featured - 30 Year Fixed Mortgage Rates 2024

Lender APR Rate (%) Points Fees Monthly
Learn More
PenFed Credit Union
NMLS ID: 401822
6.530% 6.375% 0.63 $5,200 $1,997 Learn More
Mutual of Omaha Mortgage, Inc.
NMLS ID: 1025894
6.966% 6.875% 0.75 $2,982 $2,103 Learn More
Rocket Mortgage
NMLS ID: 3030
7.451% 7.375% 0.75 $2,400 $2,211 Learn More
Neighbors Bank
NMLS ID: 491986
Learn More