Buying your first home can be an exciting experience. If you’re ready to become a homeowner, there are a number of things that you may have not considered. The home loan process can be tricky to navigate and often times stressful, but if you avoid the following mistakes you could save yourself some trouble. Here are some mistakes first-time and sometimes, experienced buyers make when they start the home loan process.
Mistake #1: Not reviewing your financials. Once you consider homeownership, it is a great idea to go through your financials to figure out how much you would feel comfortable paying each month on a mortgage. Once you come up with a comfortable, ballpark amount, you can meet with a lender to see what you qualify for.
Mistake #2: Not talking to a loan officer first. Your home buying process doesn’t begin with the home search. The first step is to talk to a loan officer and get prequalified. Getting prequalified will involve taking a look at your credit score and financials to find out how much you qualify for. By doing this first, it makes your offer much stronger. Summit Funding loan officers can be found here.
Mistake #3: Financing other big purchases. One of the biggest sins of the home loan process is making a large purchase during this time. Financing a large purchase, such as a new car or new furniture, can greatly affect your debt-to-income ratio and will have an affect your home loan approval. It is best to make all these purchases after your loan has closed and you are moved into your new home.
Mistake #4: Switching jobs. The home buying process is not a good time to quit your job or switch professions. In order to qualify for a home loan, lenders require that you work at your job for at least two years. If you quit or switch jobs during this time, your loan has the likelihood of being denied.
Mistake #5: Not hiring an agent. If you’re new to the real estate game, it is ideal to have an experienced professional by your side. They will help you navigate the ins and outs of finding and placing an offer on your first home.