Avoid These 4 Home Buying Mistakes
When it comes to buying a home, there are four things you should definitely not do.
When you’re in the market to purchase a home, be sure to avoid making the following four mistakes if you want to guarantee your success:
1. Becoming self-employed or quitting your job. Lenders need two full years of your employment history in order to give you a pre-approval for your home loan.
2. Creating more debt for yourself. Don’t make any major purchases that would affect your debt-to-income ratio, including buying a car, excess use of your credit card, signing up for a new timeshare, or applying for another loan. Lenders look at your debt-to-income ratio to determine how much you can afford; the more debt you have, the less purchasing power you have.
3. Spending the money you have set aside for closing costs. Closing costs are typically around 2% of the full purchase price of the home. Make sure you have that money set aside; if you don’t, just make sure to let your broker know.
4. Making major deposits into your bank account before speaking to your lender. Any large deposits will need to be explained so your lender can source your income.
If you have any more questions about how to succeed on your next home purchase, don’t hesitate to reach out to us. We’d love to help you.