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Common mistakes that first-time home buyers make

It is harder than ever to find the perfect home
It is harder than ever to find the perfect home
Photo by David Ramos/Getty Images

Have you been looking for a home in the San Fernando Valley or Los Angeles? Have you been disappointed with the kinds of homes that you have seen? Have you made offers, only to lose them out in multiple bidding situations? These three tips might help you, even if you do not live in California.

  • Be realistic about your finances and what you can afford. Home prices have rebounded from the recession and prices have likely risen since you first began considering making a purchase. Home inventory is really short, too, which results in more buyers chasing the same few homes. If you find yourself in a multiple offer situation, price is going to matter to your seller much more than your good looks. If you love a home, but will be really stretched to afford it, or if you do not have a decent down payment for the home price range that you are looking in, you may want to wait awhile and save up more money.
  • Before you begin home shopping, take the time to get pre-approved for a mortgage loan by a local lender. Now is the time to shop for a lender and rates, not on a Sunday night after you have visited the open house of your dreams. This is important because most sellers and listing agents will look at your financial qualifications before they review your home offer. Your lender should be somebody that you can "go live" with at any time of the day. They should be able to look at your financial profile and determine how much you can comfortably pay. A good lender can also coach you regarding cleaning up credit, straightening out financial issues, and qualifying for the best loan programs.
  • Write good offers. A home purchase offer contains much more than just the price, and your Realtor will be able to advise you on how to make your offer stand out. Put down a decent deposit. Find out in advance what your sellers' moving dates are and try to accommodate them. Shorten your contingency periods if you can. Think twice about asking the seller to pay for any of your closing costs. Yes, a letter explaining who you are and why you like the house be helpful, too. Make sure to include a picture of your kids and pets.

Hopefully, you will now be better prepared to find your next house. Happy house hunting -- your perfect home really IS out there.

Be realistic about finances
Be realistic about finances Joe Raedle/Getty Images

Be realistic about finances

Is this a home that you can afford? Will your budget allow you to purchase this house plus eat? Or will you need to choose between the two? If so, you may want to wait until you save up more money.

Get preapproved by a lender
Get preapproved by a lender Joe Raedle/Getty Images

Get preapproved by a lender

Take the time to become pre-approved by a good lender before you shop for a home. A good lender will assist you in determining what you will be able to pay for a home and what your monthly payment will be.

Write good offers
Write good offers Joe Raedle/Getty Images

Write good offers

Home purchase offers will contain several items besides the offered price. Consider length of escrow, contingency periods, and items included in sale. Also, in a multiple offer situation, the offer price does matter to the seller.