New home owners sometimes never stop to consider the possibility of losing their homes.

Some rare cases are difficult to avoid, typically due to a failing market. But most of these are simple and can be avoided if you only follow these few rules. Be keener and more observant. Just because you’ve purchased your home doesn’t mean it’s permanently yours under any circumstances. Here are 5 common mistakes house buyers make which ends up costing them their new homes.

Most Common Mistakes House Buyers Make

1. Lack of Neighbourhood research

A great home in a bad neighbourhood is still a bad home.

You might think a good house with a good price is doing you a favour, but often times the neighbourhood it’s in can be hazardous to you and your family’s safety.

Do an indepth research not only of the house history but about the street, too. You can begin by:

• Consulting the Police for a crime statistic report
• Have a casual conversation with your soon neighbours
• Observe the neighbourhood at different times of the day
• Look for other houses and compare their price. If your prospect home is cheaper by thousands of dollars, there might be a problem at its location.

2. Draining your savings

Just because you saved a good amount of money doesn’t mean you can drain it all down for your house’s initial down payment.

Don’t spend every cent that you have on a down payment and expect to look for other resources on your closing costs, house repairs and maintenance, and other additional bills to cover.

If your savings couldn’t cover all of these, then you’re spending too much on your down payment alone. Some of the mistakes house buyers make is relying to their relatives for money, credit cards, or cashing out their retirement accounts to meet the ends. But this should be avoided! Know your control and limitations.

3. Deliberately burying yourself in debt

Closing a home is great. It’s a great feeling and the home equity loans also sound amazing. So, what do you do? Set a vacation abroad this winter? Buy a jacuzzi in the backyard? Throw a massive, massive party to celebrate?

This mistake is dubbed as deliberately burying yourself in debt. Because while living the dream is just plain attractive, you need to take care of your responsibility and pay for investment.

Just ONE major setback like a lost job or an emergency expense could cost you your new home if not careful.

4. Ignoring House Inspections

Yes, you should be saving money. But is it just to take a pass on home inspections?

No.

How else would you know the roof is near its crash, the pipes are corroded, and if the electrical wiring is faulty?

All of these could lead into a way larger problem to be covered by your emergency funds if you defer a house inspection. Just because you can’t see a problem doesn’t mean it’s not there. Qualified inspectors will cover every aspects of your home to relieve you from any financial and safety risks before they even get worse.

5. Bad Real Estate Agent

A real estate license is not the only basis for a capable agent.

Some could be poorly informed and others are making sure the house seller will be the one who’ll get the most out of your transaction.

Here are some tips in choosing a good fighting agent loyal on your side:

• See your prospect agent’s experience and real estate records.
• Interview your prospect agent. Don’t hesitate in covering even the most difficult questions and situations.
• Sign your buyer’s broker agreement

One doesn’t have to be a real estate expert to avoid getting drowned in debt and start saving money for the most reasonable purchases.

Just be smart about handling good money and savings – most these will then be easily avoided.