If you are planning to buy real estate in the near future, there are certain things that you should avoid doing as they may impact your financing options. The following are 5 mistakes to avoid before buying real estate in Hamilton NJ.
5 Mistakes To Avoid Before Buying Real Estate In Hamilton NJ
Mortgage companies review your debt to income ratio. Increasing balances either on your credit cards or with new loans may significantly alter that ratio. Typically, the more debt you have, the less you will qualify for on a mortgage. This is particularly important after you have found a home and have initiated the mortgage process. Mortgage companies may re-check your credit report shortly prior to final approval to verify that things have not changed. If you incurred new debts, this can lead to issues with the final approval.
As part of the mortgage process, lenders look at your previous and current earnings to analyze your ability to make payments. A solid history in employment is very important. Shifting employment before or during the loan process can cause problems with qualifying for a loan, especially if the new employment is in a different line of work or provides lower pay. During the loan process, it may also cause delays while the new job is verified.
Mortgage processors usually review your bank account history over the last several months. Moving your funds to a new institution may cause issues. It is recommended that you keep money in the same account until the closing is done.
Many types of mortgages mandate that you use a certain amount of your own funds for the down payment or closing fees. Mortgage companies confirm this by reviewing bank statements. Any cash transactions are carefully scrutinized. You may be asked to verify the source of such deposits.
Shutting Down Accounts
While preparing to buy a home, you may decide to diligently pay down credit cards. Before doing this, consider speaking with a mortgage consultant on whether it is needed based on your financial situation. If you do pay off debts, do not terminate the accounts as this will reduce your credit score. It is better to keep the accounts open with no balance.
Additional Information on 5 Mistakes To Avoid Before Buying Real Estate In Hamilton NJ
The above 5 mistakes to avoid before buying real estate in Hamilton NJ covers only a few examples. As a local real estate professional, I can provide you with a list of local lenders in . You may reach me, Joseph Giancarli, at REMAX Tri-County via phone at 609-587-9300 or email at email@example.com.