The process of buying a new home can be both exciting and nerve racking. Many factors need to be considered and there may be disappointments to deal with along the way. But being prepared can help you avoid some of the pitfalls. If you want to avoid the heartbreak of not qualifying for a home you’re looking at, or maybe having to pay a higher interest rate, there are some things you need to have in mind. When it comes time to buy that home, you’ll be glad you didn’t make these mistakes.
One of the most important things to stay on top of is your credit score. Your credit score can influence everything from car insurance to buying furniture. When buying a house, your credit score will have a huge impact on what interest rate you can get on your mortgage and may even influence your qualifying status. It’s important to note that most traditional types of mortgages will require a credit score of above 620. Over the life of a mortgage loan, a good credit score will have saved you tens of thousands of dollars. It’s a good idea to check your credit score and get it in order before you start looking for a house.
Your finances will be gone through with a fine-toothed comb once you apply for a mortgage loan. Because of this it is very important that changes to your financial picture be kept to a minimum until your loan has closed. Even changing jobs in the middle of buying a house can cause the entire process to be reevaluated increasing the time and complexity of the loan. Delays like these can in some cases cause deposits to be lost, or sellers may become discouraged and change their minds. Try not to take on a new job until your mortgage loan has closed.
Remember, even something as simple as applying for a credit card when you’re in the middle of the mortgage loan process can be detrimental because it will also affect your financial picture and cause the lender to reevaluate. Make your home buying experience a little better by avoiding these mistakes.