Is buying a home in your near future? If so, you will probably be asking to borrow $200,000, $300,000 or even $500,000. That’s a lot of cash!
Certain requirements come along with lending large sums of money. Here’s what you can do now to improve your chances of getting approved.
Buying a House?
Here’s Your “Must Do” List
1. Save money like a squirrel saving nuts for the winter. Stop buying $5 coffee drinks, another pair of shoes (when you already have pairs with no holes in the soles), clothes on sale, restaurant meals, and all those other seemingly small — but honestly — unnecessary items. The underwriter wants to see your bank balance increasing every month to show that you will be able to afford a house payment that’s more than your rent.
2. Say no to offers to open new credit. Getting a new credit card to save 10 percent on your purchase today will lower your credit score. It is not worth the savings! You want top tier credit so that you qualify for the lowest interest rate on your mortgage. It makes no sense to save $20 today and pay $1,000s more in interest on your house payment.
3. Be happy driving your old car. One of the biggest mistakes people make is adding an auto loan to their debt ratio. The proper way to prioritize is house first. Everything else is secondary and must wait until after you are in your new home.
THE SACRIFICE YOU MAKE TODAY WILL BE WORTH IT WHEN YOUR REALTOR HANDS YOU THE KEYS.
Do your friends a favor and pass on this information to them. As always, thank you for reading my posts.