There are many things that should be done when preparing to buy a home. The first thing to do is to consult a mortgage professional. You will be able to find out how much of a home you can afford to buy, a down payment will be required or you will be able to qualify for a zero down mortgage, and how much your monthly mortgage payments will be based on your pre-approved loan amount. You should do this before meeting with a Realtor to start looking at homes so that you know what exactly you can afford.
Discuss your specific situation with your mortgage professional to find the best program and rate for you. Ask if there is anything you can do to improve the rate. Sometimes you can get a better interest rate if you can fully document your income and assets, or if you pay off some small debts, or if you put a little more money down.
When preparing to buy a home you will not want to make any changes to your financial profile. Avoid making any large purchases, such as a new car, or furniture for the new home. Do not transfer funds between accounts. Do not take a new job, or suddenly retire. Such significant changes can impact your ability to qualify for a new home. Be sure to check with your mortgage consultant before you do anything that might raise a red flag to the lender.
Purchase a copy of your credit report. Scrutinize it thoroughly to find any incorrect information that may have a negative impact on your credit profile. If there is any entry that are not update or simply false, write to all three credit bureaus to request that they remove or update the inaccurate items. Examining the credit report should be done before the actual mortgage application process because correcting false entries can take months.
Next, decide on the area in which you want to live. Your individual priorities will ultimately be the highest influence in your decision-making process. Ask yourself questions based on your greatest needs. Those needs will also steer you towards areas of your community where you may want to live. The next step would be determining if you can afford the average home in that area.
If you are applying for a mortgage its important to make sure no changes are made to your credit. One easy way to know if a particular purchase will affect your credit is if a retailer asks for your social security number. Tell the clerk that you are in the process of buying a home and you will not provide that information at this time.
In addition to making sure that no changes are made to your credit, you will also want to make sure that no changes are made to your employment. Do not quit your job or reduce your hours until after you have made your home purchase.
Also, if you have been saving for a down payment, make sure that you leave those funds in the bank account that they have been accumulating in. The lender may want to verify that they have been there for at least two months. This is called seasoning.
When you are ready for a mortgage pre-approval, contact me at 888-418-4467 or info@TheMortgageU.com.
In addition to reducing your hours or quitting also don't go on maternity leave.