Is a new house on your horizon? While you’re daydreaming about your home-to-be, don’t forget to make planning a priority. Preparing for a new mortgage takes time and can be an added source of stress for new and veteran homeowners alike. To lessen the burden and provide you with guidelines to follow, we’ve created the ten commandments of buying a home. For best results, follow the important rules listed below!
- Thou shalt not change jobs, become self-employed or quit your job - No one is suggesting that you stay in the same job forever or avoid exploring new opportunities. However, know the time and place. Any big changes can delay or halt your approval from lenders. Save big moves for after closing.
- Thou shalt not buy a car, truck or van. (Or you may be living in it!) - Fancying a new ride for your driveway? Hold off. This additional loan and expense is a good way to delay your application.
- Thou shalt not use credit cards excessively or let current accounts fall behind - This commandment might seem like common sense but it bears repeating. You want to keep your credit score as healthy as possible during this process. Late payments and high balances are the equivalent of poison for your credit score. Avoid taking out new credit cards as well.
- Thou shalt not spend money you have set aside for closing - Of course, you’ll need that money to close but your lender may also have to check your cash reserves again. If the money isn’t there, you might find yourself in a sticky situation.
- Thou shalt not omit debts or liabilities from your loan application - Omitting debts or liabilities from your application might lower your debt-to-income ratio but it’s also a form of mortgage fraud. This is one move that has potential implications beyond delays.
- Thou shalt not buy furniture on credit - Who wants an empty home with nowhere to sit? Still, don’t let your desire to furnish your new place hurt your credit score. Save big purchases like these for post-closing time. Buy what you can, use what you already own and update when the time is right.
- Thou shalt not originate any inquiries into your credit - Too many inquiries can negatively affect your credit score, which is the last thing you want.
- Thou shalt not make large deposits without checking with your loan officer - Large deposits require a proof of source. Deposits might look like money obtained through a loan or cash advance, which would need to be included in your debt ratio.
- Thou shalt not change bank accounts - An inconsistency like switching bank accounts makes it harder for your lender to keep track of your assets.
- Thou shalt not co-sign a loan for anyone - This one just has too many risks to justify the reward. The loan is still completely your responsibility and you could be sued by the lender if you don’t pay up.
Special Advice for First Time Buyers
If you’ve been waiting to buy, recent news says now is your time. Rates for 30-year U.S. mortgage rates have fallen below 4 percent as of July 30, 2015. Things are looking good for building stats as well in the St. Tammany Parish area with 25 percent increase from the first quarter of 2014 to the first quarter of 2015.
To make the most of this opportunity, contact Ace Mortgage (http://www.acemortgagela.com) for a quick quote online. Our team of experts provide assistance through the loan process and a variety of loan products to choose from.