Top 10 Mistakes First-Time Home Buyers Make

1. Timing Problems. Not planning the move to coincide with the end of your rental lease often creates a big dent in the budget. Ask your landlord about an early release clause in your lease if you are considering buying a home, or sign a month-to-month extension.

2. Looking at Homes You Can't Afford. Prequalify with a lender before you call a Realtor to look at homes. You'll know exactly what you can spend and won't be disappointed later on.

3. Buying the Wrong Sized Home. Consider how long you plan on being in the property and plan for any lifestyle changes that could possibly happen.

4. Buying in a Neighborhood You Know Nothing About. Think about whether this neighborhood will make you as happy as the house does. Do your homework.

5. Operating on a First-House-is-Best-Theory. Season your eyes by inspecting different types of homes. This will help establish your objectivity. Keep notes and do "pro and con" lists. Compare the convenience of differing floor plans.

6. Buying a Property That's Difficult to Resell. Walk yourself through all the negatives to the property. Most first-time home buyers sell within five to seven years. Think hard about how you would sell the home.

7. Overextending Your budget. Just because agents say you can afford a certain monthly payment doesn't necessarily mean it's within your comfort zone. Write down everything you spend for two months. Then plan for emergencies, vacations, savings, and upkeep of the new home. You'll have a much better picture of what kind of payments you can really afford without feeling pinched.

8. Being Indecisive. Take all the time you need, but don't be afraid to make a commitment when you've found the home that fills your needs. Everyone gets cold feet at some time during the process, but don't cave in to fear or panic.

9. Choosing the Wrong Mortgage. The thirty-year fixed-rate mortgage is not your only option. A fifteen year mortgage, for example, has only about a 20% higher monthly payment, but the term is cut by half. Ask your lender to show you the differences in cost on paper of different types of mortgages and find out about pre- payments.

10. Under-Insuring the Property. Don't forget to increase insurance coverage as the home appreciates in value, and to update your policy to reflect the value of the contents.