Buying a home can be quite scary, especially if it is your first time. There are lot of things that you need to take care of, which you will be completely unfamiliar with. That is why people sometimes make mistakes along the way, especially when it comes to getting the mortgage. Be sure not to do any of these three things.
Not Looking At Your Credit History
It is important to take a good look at your credit history and try to resolve any potential issues before you apply for a mortgage. For example, your credit history may still list debts that have already been paid off. You'll want to clear up any issues well in advance of applying for your mortgage, since they can take a while to resolve. The last thing you want is to be surprised when your mortgage application is declined, all because you didn't take the time to look at your report beforehand.
Changing Your Job
Once you apply for your mortgage and start the whole process, it is important that anything regarding your finances do not have any significant changes. This includes your current employer. Your lender may follow up with checking your employment status right before your closing date, and if they discover that you no longer work for that employer, they may decline your loan.
Suddenly changing jobs in the middle of a big purchase can show how you do not have job stability. If you know that you will be changing jobs in the middle of your application process, let your lender know so that they can be well prepared. You may need to provide proof of your new salary so that the lender can verify your new debt-to-income ratio.
Making Large Purchases
Many new homeowners are excited about the idea of owning their first home and making renovations. In fact, they'll be eager to stop by their local home improvement store, open a new store credit card, and start purchasing things that they need to start making changes. Unfortunately, this is a mistake that can cost you your mortgage.
Much like a change in employment, a mortgage lender does not like to see sudden spending during the approval process. Opening new lines of credit and taking on more debt can affect you in a negative way. While it may not seem like a big deal, it is best to delay these purchases until you close on the home and the keys are in your hands.
Share19 March 2018
A few months ago, I realized that I was flat broke. I didn't have the money to pay my rent, and I knew that my parents didn't have a dime to lend me. I was in a bad situation, so I decided to start shopping around for a financial services company who might be able to issue me a short-term loan. To my surprise, I was able to find an amazing business to work with that offered low interest rates and acceptable policies. This blog is for anyone out there who has been in a similar situation, and who needs to understand written contracts a little better.
