Mistake #5: Running Out to Furnish the House you Haven't Bought Yet!

By
Real Estate Broker/Owner with MBA Broker Consultants CalBRE Broker #00983670

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:

Stay tuned for our 7-part series!

Regina P. Brown
Broker / Trainer
California Coast & Country Homes, Inc.

Posted by

Regina P. Brown
Broker, Realtor®, M.B.A., e-Pro, GREEN
California DRE # 00983670
www.CalCoastCountry.com

                

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Comments (5)

Sharon Parisi
United Real Estate Dallas - Dallas, TX
Dallas Homes

Regina, this is a good list.  I constantly remind buyers not to make any major credit card purchases while in the process of purchasing a home. I recently heard a credit repair guru say that no major purchases should be made 8 months prior to applying for a home loan.

Mar 25, 2012 03:55 PM
Regina P. Brown
MBA Broker Consultants - Carlsbad, CA
M.B.A., Broker, Instructor

Sharon, 8 months is a long time for most people to wait... but yet if your dream of homeownership is strong enough, you can resist the temptation to buy stuff on credit, right!

Mar 25, 2012 04:15 PM
Bernadine Hunter, SFR, ACRE
Keller Williams Greater Columbus Realty - Pickerington, OH
"Finding Solution to Your Real Estate Needs"

These are all really good recommendations. I'll also take a look at your prior posts. By the way, you and I would think, who would EVER pass on a home inspection, but I've certainly had that suggestion given to me because they had a friend or boyfriend in "maintenance."

Mar 25, 2012 05:25 PM
Regina P. Brown
MBA Broker Consultants - Carlsbad, CA
M.B.A., Broker, Instructor

Thanks, Bernadine, for contributing your experience to our post here.  Hope you enjoy our other blogs!

Mar 26, 2012 05:52 AM
Joy Daniels
Joy Daniels Real Estate Group, Ltd. - Harrisburg, PA

I like this one.  It kind of falls into making big appliance purchases and having it effect your credit score and not being able to close!!  OR asking if you can paint the house or do other work in the property before you close. . . why?  Again (like your #6) you need a Realtor to represent YOU and help you understand the whys!

Mar 31, 2012 09:41 PM