What to avoid when you purchase a home
Surprised to learn how many things can go wrong when buying an apartment for the first time? homeowners are often shocked in a number of ways. It's possible that you have already been approved for your mortgage and found the perfect property. However, if you wish to ensure that you don't mess up the deal, you'll need to be extremely careful until the transaction is closed.
Keep reading as I tackle what not to do before buying an investment property. These are the most common mortgage errors which can be easily avoided. If you've got an excellent mortgage broker or real estate agent, most likely, a few of these points have been discussed before.
These tips will help you safeguard your home and ensure that you are protected.
Making mistakes is not difficult even if you've never owned a home before. Make sure you avoid these home-buying mistakes to keep the stress out of your life!
1. Don't miss loan payments.
All your loans, including credit cards and auto loans, should be paid on time. The lender will examine your credit again before finalizing your mortgage, and if you have missed any of your payments, it could lead to you losing the loan.
Many people believe that they are guaranteed a loan once their lender has made a commitment. It's not the case!
Lenders are able to revoke a mortgage commitment and will do so if they think it appropriate. A buyer bought a house I listed in Centralia IL. The buyer was at the same time buying and selling a house. The buyer closed on the property but did not pay off the mortgage.
This was reported on the buyer's credit report which stopped them from receiving a loan to finance the purchase.
They were required to make an application at the bank for an entirely different program (FHA instead of the conventional one). Needless to say, this led to their purchase being delayed, and as a result, they lost thousands of dollars.
2. Be careful before you consolidate your debt.
Debt consolidation can be tempting when you are finally thinking about buying a house. Consolidation deals allow you to consolidate all of your debts into one payment. This is a good alternative for some.
There are often hidden charges or interest rates that may increase quickly without notice. The consolidation of your credit might not bring you the credit improvement you're seeking. Be sure to go over the small text.
3. Avoid changing jobs.
It goes without saying that switching jobs isn't something you should consider during the process of buying a home! Your employment history is one of the most important things lenders will scrutinize. They want to ensure that you're financially stable and capable of making your repayments on loans.
By changing a job before you get your loan, you are less attractive to lenders. The lender might think you are unstable or don't have enough income to repay the mortgage. They love stability.
Your move should be kept private until the time of closing.
4. Do not move your money around before you apply for the loan.
The present financial condition of your finances is what the lender will use to pre-approve you. At all costs, you want to keep that approved status. Many buyers make the mistake of shifting their money around to get better placed. This isn't an ideal strategy.
There is no need to change your financial situation before you have your mortgage. The lender will ask for an explanation in the event that you transfer money between accounts.
You'll have to give them a detailed accounting of why you moved your money around. Avoid making this mistake and ensure that your funds are in one location prior to closing.
5. Don't open a bank account at a brand-new institution.
There's a chance that you are angry with your bank. Maybe you were offered a better rate from a different bank. Don't miss the opportunity because switching banks can result in problems when you apply for a loan.
6. Do not buy an automobile.
It's not uncommon to buy an automobile and later purchase a house. It's also on the top of the list of what you shouldn't do before buying the home of your dreams. The excitement of finally owning the home of your dreams can leave you seeking out other options to improve your quality of life, like buying a vehicle.
7. Credit isn't a great alternative for furniture or household goods.
Another mistake homebuyers do is using credit to get ready for their new home. While you might be tempted to buy appliances and furniture to make your house fully yours, it's best to wait.
Do not accept any new loans for furniture or household items. This will affect your credit score and could lead to an alert from the lender, which could result in your loan approval being denied.
It is not difficult to make a mistake when you are applying for a mortgage especially when you're a first-time homeowner. We hope that you find this article useful and that you will not make any financial mistakes.
Are you looking for a realtor in Centralia who knows the ins and outs of Centralia, Illinois? Look no further than Cindy Quinn! As a realtor in Centralia, Cindy has helped countless buyers and sellers navigate the local market.
820 E Noleman St, Centralia, IL 62801