We’re going to review some of the common mistakes that first-time buyers make, and we’re going to show you how they can ruin your opportunity to buy your first home. How to avoid those types of blunders? You'll find out in our HousePro Academy online course, Home Buying 101.
MISTAKE #5: Getting Excited and Buying New Furniture Before Closing
The fifth mistake is buying a car or furniture loan before you complete your home purchase. I know you’re so thrilled to be buying your new home and you want some beautiful new furniture to complement your house. It’s so hard to resist… but you’ve go to do it. I’ve seen so many times where the home buyers went out and bought a bunch of furniture on credit while they were in escrow for their home purchase. Right before the closing date, their mortgage lender ran their credit one last time, and guess what pops up? That’s right, a huge personal debt for consumer goods or a car loan. So now, the lender has to go BACK to the loan underwriting and re-calculate the debt ratios… and guess what, now the buyers have a higher debt ratio and their loan rate goes up. Or even worse, they no longer qualify for the mortgage loan. They have to back out of the transaction, and also forfeit their deposit they put down. Don’t put the cart before the horse, don’t jeopardize your home purchase, keep your down payment money ready and don’t buy ANYTHING on credit until after you have the keys in your hand!.
Here's other common mistakes that you DON'T want to make:
- Mistake #1: Not checking credit report in advance
- Mistake #2: Mis-calculating budget / housing costs
- Mistake #3: Skipping the home inspection
- Mistake #4: Not doing your "due diligence" research
- Mistake #6: Not understanding the process
- Mistake #7: Trying too hard to get a bargain
Stay tuned for our 7-part series!
Regina P. Brown
Broker / Trainer
California Coast & Country Homes, Inc.