Buying a new home is a fun and exciting process. It’s not every day one becomes a bonafide homeowner after all. That being said, it’s important not to allow the excitement of buying a house for the first time to push you into making rookie mistakes along the way.
Plenty of things could still go wrong even if you’re a few feet away from the finish line. Maybe you just got your pre-approval letter from your lender, or you’re under contract waiting to close. Some things could still go wrong before you get to closing.
Samantha Outlaw of Reach Home Loans gives first-time homebuyers some tips on what not to do before buying a new house to avoid making mistakes and closing the deal.
Okay, we get it. A new car, a new truck, or a new van would look good when paired with your new house, right? Almost everyone will agree that it will indeed feel good to pull up on your new house’s driveway in your shiny new car. It’s good when everything smells brand new, right? Wrong. Buying a brand new vehicle is a huge financial decision that could affect many elements that qualify you for your mortgage.
“If you have this idea, and there’s a little voice in the back of your head saying, ‘I wonder if this is a good idea?’ It’s probably not, and you should call your lender before you make any huge financial decisions.”
Whether you buy them brand new or second-hand, buying furniture to fill a whole house can cause a considerable dent in your savings. It won’t look good as well if you plan on using your credit card. We’re not saying you shouldn’t buy furniture for your new house. It’s just that it’s better to wait until the deal’s closed.
“I know you’re excited. You’re like, ‘I’ve got this new big house with all these rooms to fill. I need new stuff.’ That’s fine. Just wait until after closing.”
Maybe you want to work closer to your new home. That’s understandable. Or perhaps you just want a fresh start since you just bought a new home and you’re starting to lay down roots. However, what you earn from your current job is part of what the lender has evaluated in your finances—making a huge change, like switching jobs, after being approved for a loan, and right before you close is probably not a good idea.
“Keep your job, don’t quit. Don’t move to a new company. Do nothing. Go to work, come home, sit on your hands.”
After getting approved for a loan, it’s better to stay with your bank for the time being. Also, try not to rack up huge credit card debts. And don’t close your current credit cards or open new ones since these could factor in your debt-to-income ratio. Also, refrain from making massive deposits since these could be flagged by the underwriter when they can’t tell where the money came from, which could affect your closing.
“At the end of the day, it’s your debt-to-income ratio. And that is a big factor in what qualifies you for the mortgage. If you change that number by changing any of your debts or any of your income, it could affect your ability to close, and you might lose the deposit and the house that you love.”
The excitement of buying a new house can sometimes make some of us make questionable financial decisions. If you haven’t closed yet, then technically, the house still isn’t yours. Make sure that the financial decisions we make before closing won’t affect our chances of finally owning a home.
Would you like professional guidance on your journey to becoming a first-time homeowner? Reach Home Loans can make that happen for you. Our years of experience servicing homebuyers in Florida made us one of the trusted lending agencies in the state. So call us now at 954-703-1465 to get started.
With our years of experience, we are completely focused
on getting you the best deal.