If you are thinking about buying a property within the next year, there are certain things that you should avoid doing as they may hinder your ability to get a mortgage. The following are NH buying mistakes to avoid.
NH Buying Mistakes To Avoid
Mortgage companies evaluate the percentage of your debt to your overall income. Making major purchases either on your credit cards or with new loans can dramatically alter that percentage. Generally, the higher your debt, the less you can qualify for on a home loan. This is even more important after you have found a home and have initiated the loan process. Mortgage companies will re-check your credit report shortly prior to closing to ensure that nothing has changed. If you took on new debts, this can lead to issues with the final approval.
As part of the approval process, mortgage companies look at your previous and current earnings to evaluate your ability to pay back the loan. A solid history in earnings is essential. Moving employment prior to or during the mortgage process can create difficulties with qualifying for a mortgage, especially if the new job is in a different line of work or at a lower salary. During the loan process, it can also cause delays while the new employment is confirmed.
Mortgage processors usually evaluate your bank account history over the last several months. Moving your funds to a different bank can cause delays. It is advisable to leave money in the same location until the closing completes.
Many types of mortgages mandate that you use a certain amount of your own funds for the down payment or closing fees. Mortgage companies confirm this by reviewing bank statements. Any cash transactions are carefully scrutinized. You may be asked to provide details on the source of those deposits.
While preparing to buy a property, you may try to pay off credit cards. Before starting this, consider speaking with a mortgage consultant on whether it is needed given your financial situation. If you do pay off bills, do not terminate the accounts as this will lower your credit score. It is better to keep the accounts open without a balance.
More Guidance on NH Buying Mistakes To Avoid
The above NH buying mistakes to avoid is only a few examples. As a local loan officer with Accurate Title, I canreview your financial situation and provide advice on other actions to avoid prior to applying for a home loan. Contact me, Donna DuFour, by phone at 800-639-4405 or email at firstname.lastname@example.org.