Buy a Home in 2018!

Is 2018 your time to buy a home? If so, here is a Short List to help you reach your goal.

SHORT LIST TO HOME OWNERSHIP

1) Check your credit.

  • Have or establish clean credit for 12 months so the lender can see you are on track financially. One late payment can be excused with a good explanation.
  • To qualify for the best interest rate, you want the following credit score:
    • FHA with 3.5% down payment: 620 to 640
    • Conventional with 3% down payment: 640
    • Conventional with down payment assistance: 640
    • VA with zero down: 580 to 620
    • USDA with zero down: 640

2) Save enough money for your down payment and closing costs.

Now is the time to cut spending and save money. The sacrifice is worth the reward.

3) Avoid opening new accounts.

Do not open a new credit card, line of credit, take out an auto loan, or acquire any other type of financing for the six months prior to buying a home, because doing so could hurt your credit score and/or your debt ratio for qualifying.

“Buy the house first. Buy the car later.”

4) Leave your bank accounts as they are.

Don’t move money around during the three months prior to or during your loan application, because doing so will complicate your loan file and require you to submit more documentation and letters of explanation.

5) Get the cash out of your home!

If you have money stashed in a home safe or hiding under the mattress, get that money into a bank account immediately. Cash is “poison money” and cannot be used for a home loan. The funds must be seasoned in your bank account for three months prior to loan approval.

Home Ownership is both emotionally and financially rewarding. Doing the work to get there is worth the effort.

Happy 2018, Everyone!

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6 responses

  1. Good Morning Carolyn,

    Great article! I am planning on buying a new home in 2018. Can you tell me where I can find information regarding the 3% down conventional loan? Or lenders who participate in his product? Thanks!

    1. Apologies for the typo, I meant to say I am planning on buying a new home in 2018. Thanks!

    2. Yes, I can. Please tell me what state you want to buy a home in.

    3. Yes, Chris, I am happy to help you with that. I need to know what state you are purchasing a home in.

  2. Thanks for the helpful tips on buying a home in 2018! My wife and I are getting ready to move soon, so we appreciate it. I like your point about avoiding new credit lines and bank accounts. I want to make sure we can afford the house and keep our debt low, so we’ll hold off on any big purchases for a while.

    1. Derek, if you will be purchasing in CA, OR, or WA, I would love to help you with your pre-approval and home loan.

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