Three Mortgage Must-do’s When Purchasing a Home

CHECK YOUR CREDIT

Checking your credit prior to beginning your pursuit of a home will help avoid unpleasant surprises down the road. Many issues with your credit can be resolved before you apply for a mortgage loan. Pull your credit for free from each of the three major credit agencies to check for mistakes that might be affecting your score.

STAY IN YOUR CURRENT POSITION

Don’t change jobs or switch from a salary to commissioned position in the midst of getting a mortgage loan. Changing positions can complicate or slow down the process, as your mortgage lender will need to assess your new position. It some cases, it can keep you from qualifying for a loan because you won’t meet the minimum requirements for the length of time you’ve been on the job. It’s always better to have an established employment (and income) history.

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DON'T DO ANYTHING TO IMPACT YOUR CREDIT RATING

Plain and simple: do not apply for new credit. When getting a mortgage, two things are considered by the mortgage company: your credit score and your debt load. Changes in either of these can result in not qualifying for the loan. Many prospective home owners make the mistake of believing that their loan is guaranteed. However, your credit report will be checked by your lender prior to the final approval, just days before the closing. A single credit check on your report could potentially affect your score enough to impact your interest rate, even if you didn’t actually open a new line of credit. Years ago I had buyers who decided to buy a car during the process of purchasing a home. The dealership ran an inquiry that showed up on their credit report. Even though they didn’t end up getting the loan for the car, their credit score was lowered and they didn’t get approved for the mortgage. Don’t let this happen to you!

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