Buying a new home is an exciting event in your life. You’ve been saving money for a down payment and now believe you have enough money to start looking. Of course, you may also be thinking about buying that cute family room set that is finally on sale and would look darling in your dream home. Don’t do it. These are four things you should never do when buying a home.
Don’t Make Any Large Purchases
Buying large items on a credit card may affect your debt to earnings ratio. This number reflects the amount of monthly debt payments you have in relation to your monthly income. It is also one of the most important determining factors for the amount of home you will qualify for or if at all. Always consult your mortgage professional before making a large purchase on credit.
Don’t Pay Off Debt
It is smart not to make any financial decisions without speaking with your mortgage professional first. You may think paying off debt and decreasing your debt load makes sense, but your mortgage professional may advise you to continue to save the money or use it for earnest money or closing costs.
Don’t Make An Offer On a Home
Do not make an offer on a home without the completion of the full pre-approval process with a mortgage professional. If you make an offer and are not approved for a loan, you may be required to forfeit your earnest money because the offer is a financial agreement to make a purchase.
Don’t Change Jobs
You should always speak with your mortgage professional before making any financial decisions, including changing jobs. Changes in income and industries may affect your ability to secure a loan.
Before you begin your home search, it is wise to consider the above tips and contact an experienced real estate agent, who can answer additional questions. Your agent will refer you to an experienced mortgage professional, who can begin the pre-approval process.