Do's and Don'ts when buying a home.
Buying a home is both exciting and nerve wracking at the same time. There are many things to consider when you decide to start looking for a home. The excitement of knowing that you're going to own your OWN home, decorate it as YOU want and take on the responsibilities of maintaining your home can cause other key factors to be overlooked. Here are some important tips that I provide my clients with to help the home buying process run as smooth as possible. After all...it’s the biggest purchase you will make in your lifetime….why not be prepared.
Obtain a Pre-Approval letter
Pre-Approval usually takes less than 24 hours and very few documents are needed. Typically your lender will be looking for the following items:
A credit report (pulled by your lender)
Identification ( Driver’s license...etc)
W-2’s (2 years)
2 Most Recent Bank Statement
Obtain the Pre-Approval letter from your lender for proof you are ready to purchase a home. Now it's time to start looking!
You have looked at many homes and you feel like you have found the one that is perfect for you. It has just enough bedrooms. You love the size of the yard. You love the paint color....so no need to paint. The bathroom counter isn't what you would have chosen...but it will work just fine. The windows look good and you can picture yourself raising a family in the neighborhood. It's Perfect! Or is it???
Here is another Do that I recommend to my Clients....
Hire a Home Inspector!
So many times new Home Owners are excited by the thought of owning their own home that they focus on the Cosmetics and forget about the unseen. A very little upfront cost can potentially save you thousands of dollars in the future. Take your time with the inspector and get to know the in's and out's of the home you are considering. Now keep in mind.....Not every home is going to be perfect and if you choose the right inspector they will help you to understand what is important.
Choose a qualified Home Inspector. I recommend a Home Inspector that is not only Certified but also is a Licensed Building Contractor. This way if repairs are needed he or she may be able to give you an idea of cost and severity.
My home Inspection Passed!
YAY! Now what?
There are other important factors to consider while you wait for closing....Not just packing boxes and picking out new furniture. Speaking of picking out new furniture....Here are some items on my Don't Do List.....
DO NOT Open a credit card
As simple as it may seem to open a credit card to save that 20% off your purchase at a store can actually affect your loan approval….opening a new line of credit can negatively affect your debit to income ratio.
As it may sound like a good idea….DO NOT close any existing credit cards that you may or may not use. Closing a credit card account after your pre-approval could drop your credit score and negatively affect your approval with your lender.
You have worked so hard to get to where you are today - don't let that Cashier talk you into opening a credit card to save some money. After your home closes....do what you want....but until then make sure to hold tight.
DO NOT finance a car loan.
A new vehicle purchase may affect your debt to income and void your mortgage approval. Wait until after your home closes to buy that shiny red car you always wanted. If something should happen and you are without a vehicle, be sure to consult with your mortgage lender before having your credit pulled.
DO NOT make a Career change
I will say it again....DO NOT make a career change when you are in the middle of purchasing a new home. Believe it or not, length on job plays a big role in the approval process. Even though it may seem like a perfect move for you….your lender may think otherwise. Consult your lender before making any career changes.
These are just a few tips that I like to provide my clients to help make sure their home buying experience run smoothly.
Happy House Hunting!