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    How Do I Prepare for a Home Purchase?

    How do I prepare for a home purchase?

    We talk to people all the time who feel like they want to move, but are afraid of missing out on getting the best transaction they can get. 

    The solution to this is to plan.  Not just for the purchase, which is very important, but plan ahead for the loan, too. 

    An old cliché in my business is, “Everybody wants a house, but nobody wants a loan.”  It’s true, but the reality is that positioning yourself for the best loan possible can directly affect what the house you wind up with can look like.  The difference in payment between a 3% mortgage and a 4% mortgage on the same amount of money borrowed can be great enough to change your purchase price by thousands of dollars.  That can mean more house, different neighborhoods, maybe even a different lifestyle altogether if you aren’t paying close enough attention. 

    Really, your best bet is to plan for the loan before you plan for the move. 

    If you come to us early enough in the process, we can connect you with some very capable and strong lenders who will guide you through a review of your own finances as they pertain to lending.  These people can help you tweak your position, sometimes almost painlessly, to maximize your buying power. 

    First, look at your own situation.  Here is a quick list of “do’s” and “don’ts”  that you can consider and take action with right now, without even picking up a phone.  If you are thinking about moving, even if it’s a year away, please start here:

    DO…stay current on all existing credit accounts – make those

    payments ON TIME!

    DO …continue using your existing credit as normal – but

    without large purchases

    DO ….collect and maintain all documents a lender will need ahead of time.  Keep all

    original paystubs, bank statements, tax returns and other

    financial documentation handy as you receive them. Get into the habit because you may be

    required to update your loan file during the process

    DO ….notify us if you are planning on receiving any gift funds

    for the down payment or closing costs

    DO …notify us if you have any major financial expenditures coming

    up that will lower your assets

    DO …notify us if you have any upcoming employment changes,

    raises, promotions, change in pay structure, etc

    DON’T ….open any new credit accounts or close any current

    ones

    DON’T ….make any large purchases on your current credit

    accounts or increase your spending on current credit accounts –

    business as usual when it comes to credit

    DON’T …co‐sign for anyone else for a home or car loan or any

    other type of debt

    DON’T …dispute any credit accounts on your credit report

    before or during the loan process – disputed accounts can alter

    your credit score

    DON’T …pay off any collections or charge‐off’s on your credit

    report unless advised by a credit professional or your mortgage

    consultant ‐ activating these accounts by taking action may

    alter your credit score.

    DON’T….make any type of employment or compensation

    changes without notification to your mortgage consultant

    DON’T …close any current bank accounts, open any new bank

    accounts, or move money around between accounts

    DON’T ….deposit any cash to your bank account without

    contacting your mortgage consultant to discuss the

    requirements of documentation and whether or not it will be

    accepted as funds for closing

    This list applies to anybody, and is not comprehensive.  You will need and want a personalized plan to maximize your options, so please call us today!  We will make sure that a licensed loan professional helps you with your plan, and when you are ready we will make sure that the plan gets used to get you into the best home possible for your income and financial position!

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