Six Things You Shouldn’t Do Before Purchasing A Home

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Real Estate Agent with Sarah Miller - RE/MAX Bryan College Station

Six Things You Shouldn’t Do Before Purchasing A Home 

Just because you’re buying a home doesn’t mean that life has to stop, or does it?  You never know what affect actions you take today will have on the mortgage you apply for in three or even six months.  Even something as simple as transferring money from your savings to your checking account can create hassle in the mortgage process.  Read on to find out what things you should avoid doing before buying a home.

 

Purchase a Car.  Many people are inclined to improve their social standing by purchasing a car and buying a home at the same time.  There’s nothing wrong with that.  Purchasing the car before buying a home will have an effect on what the mortgage lender determines you can afford for a home.  Since a car is such a big ticket item, it can greatly raise your debt-to-income ratio, which lenders use to determine how much of a mortgage you can afford.  Ultimately, the car purchase will decrease the amount you can afford to pay for a home.

 

Move Money Between Accounts.  When the lender does the work to determine your eligibility for a loan, they will request statements from all of your accounts that contain liquid assets.  When you move money around between these amounts, especially if they are large amounts, you will have withdrawals in some and deposits in others.  The lender will request the documentation for these.  Unless you want to keep up with all this paperwork, it’s much easier to leave the money where it is until after you have completed buying a home.

 

Change Banks.  This can easily be coupled with moving money between accounts.  It just creates additional paperwork for you and the lender.  To make it easier on yourself and the lender, stay with your current bank until the mortgage is complete.

 

Become Self-Employed or change jobs if you are employed part-time.  Either of these could have a negative affect on your mortgage approval.  In most cases, lenders want to see at least two years of self-employment they will approve you for a loan.  Wait until after buying a home to become self-employed.

 

For part-time workers changing jobs creates unpredictability in the number of hours that you will work from one week to the next.  As such, the lender cannot determine your gross income to qualify you for a loan.  Stay with your current job until you have the loan, then change.

 

Apply For a Credit Card.  Even though the inquiry won’t hurt your credit too badly if you already have a good credit score, the additional credit card will cause the lender to question your financial stability for buying a home.

 

Make a Large Purchase.  Of course you are going to need furniture when buying a home.  Resist the urge to purchases a new sofa set until after you have obtained the mortgage.  Big ticket items purchased before buying a home can cause the lender to take a second look at your financial situation.

 

When you are buying a home, it is best to stay away from anything that will make it look as though you don’t your finances under control.

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If you have questions about the real estate market in Bryan College Station or about buying or selling a home in Aggieland, please contact me, YOUR College Station Realtor!

Sarah Miller

RE/MAX Bryan College Station

http://www.sarahmillerinc.com

979-255-1904

 

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