The 7 Biggest Mistakes First-Time Homebuyers Make in South Dakota

Buying your first home is exciting, but it’s also one of the largest financial decisions you’ll ever make. While every homebuying journey is unique, there are a few common mistakes that can create unnecessary stress, delays, or additional costs.

If you’re planning to buy a home in South Dakota, avoiding these mistakes can help make the process smoother and more enjoyable.

1. Waiting Until You Find a House to Get Pre-Qualified

Many buyers start shopping online before understanding what they can comfortably afford.

Getting pre-qualified early helps you:

• Understand your budget
• Estimate your monthly payment
• Identify loan programs that may fit your needs
• Shop with confidence

Starting with a conversation about financing can save time and prevent disappointment later.

2. Assuming You Need a 20% Down Payment

This is one of the biggest myths in homebuying.

Many South Dakota homebuyers purchase homes with much less down, depending on the loan program and individual qualifications. FHA, Conventional, VA, and USDA financing may all offer lower down payment options than buyers expect.

More downpayment information: Downpayment Guide

3. Making Large Purchases Before Closing

Financing a new vehicle, opening credit cards, or taking on new debt can affect your mortgage qualification.

Even if you’ve already been pre-qualified, significant financial changes can impact your loan approval.

It’s usually best to avoid major purchases until after closing on your new home.

4. Forgetting About Closing Costs

Many buyers focus entirely on the down payment and overlook other expenses involved in purchasing a home.

Potential costs may include:

• Appraisal fees
• Home inspection fees
• Title expenses
• Closing costs

Understanding these expenses upfront can help you prepare more effectively.

5. Skipping Research on Available Programs

South Dakota homebuyers may have access to a variety of loan programs depending on eligibility.

Some options may include:

• FHA loans
• Conventional loans
• VA loans
• USDA loans
• South Dakota Housing programs

Taking time to understand your options can help you find the best fit for your situation.

6. Focusing Only on the Interest Rate

While interest rates are important, they are only one piece of the puzzle.

It’s also important to consider:

• Monthly payment
• Loan term
• Down payment requirements
• Mortgage insurance
• Overall financial goals

The lowest rate doesn’t always mean the best loan for your needs.

7. Not Asking Questions

Many first-time homebuyers worry about asking “basic” questions.

The truth is that buying a home involves a lot of moving parts, and asking questions is one of the best ways to feel confident throughout the process.

A good homebuying team should help educate you every step of the way.

Final Thoughts

Buying your first home doesn’t have to be overwhelming. By avoiding these common mistakes and understanding your options early, you’ll be better prepared to navigate the process with confidence.

For a complete overview of the homebuying process, check out my South Dakota First-Time Homebuyer Guide.

You can also learn more about available homebuyer resources through South Dakota Housing.

The more informed you are before you start shopping, the smoother your homebuying experience is likely to be.

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Mike Bellmore
NMLS#2267854
Member FDIC
Equal Housing Lender
All loans subject to credit approval.