Home buying Guide - Critical to your Ability to Purchase

 

Let's start with a few questions:

 

1 - Have you checked your credit lately?  It's easy to do.... www.myfico.com would be a good place to start.

2 - Have you made any major purchases recently?

3 - Do you have a home to sell before you can buy?

4 - How much money do you plan to invest in your down payment?  Where is this money coming from?

5 - Will this be your principal residence ...or will it be a second home?

6 - Will you want the sellers to pay your closing costs?

7 - What is your current debt load?

8 - How long have you been employed in the same job?

9 - Or, are you self-employed?

10 - Do you forsee anything in the near future that will affect your financial situation?

11 - Are you currently involved in any legal situation?

12 - Have you co-signed with anyone for anything?

 

The answers to these questions can dramatically affect your ability to purchase a new home.  This home buying guide can save you thousands of dollars.  Let's talk openly and honestly about any issue you have ... now ... before it becomes a crisis.  Remember that I am on your side...only here to help you.  And, since I've been a Realtor for well over 25 years, I've seen (and been involved in) many situations.  Often, I can head off a problem for you that could end up causing you not to be able to close on the home.  This is not a time for secrecy...because everything will be out in the open before it's over.  And almost never as big a deal as you think it is.  Please use this homebuyers guide and contact me with any questions you have.

 

Here is good advice, whether you are buying Nashville Real Estate - or in another area.  It will apply in either case.

 

1 - Always check your credit well in advance of a new home purchase.  This will give you ample time to correct any errors that might be detrimental to your score.  And there are more errors than you might think.

2 - If you have to sell your current home - do it now.  Many times people try to find their new home before selling their old one - but it often results in heartache.  This is because most sellers (even if they will accept a contingency contract) - will only do it if they can keep their home on the market...giving YOU 24-48 hours notice if they receive a better (more acceptable) offer.  Also, it reduces your negotiating power when you can't close quickly on a property.  If you are ready and prepared to buy, we can usually negotiate for a lower price for you.

3 - Don't - don't - don't make any major purchases.  This will seriously hamper your home buying ability.  If you need a car....wait!  If you need furniture....wait!  A new purchase can destroy your income-to-debt ratio.  It's not worth losing your home purchasing power because of this purchase.  Your debt-to-income ratio could possibly cause you to have to settle for a much lower home price than you feel you can afford. So, please wait for any purchases.  Don't even apply for anything that would cause a "hit" on your credit report because the lender will ask questions about why this lender was inquiring about your credit.

4 - What about your down payment?  Is it coming from savings?  A 401-K?  Parents or relatives?  Whatever you do, don't make any changes in your bank account.  Keep it smooth and steady.  Some FHA programs allow parents or relatives to help with the down payment.  If this is in your plans, the lender is going to want not only a gift letter...but also proof of where this money is coming from.  What bank account?  They will want to see your parents or relative's bank statements for the account where this money has been deposited.  We will have to establish the "paper trail".

5 - If this purchase is a second home or investment property - you will most likely have to have 20% down.  There are some programs that will allow a 10% down payment - but you will really have to "jump through hoops" for less than 20%.  Meaning a ton or paperwork...and proof of everything.

6 - Remember that seller concessions for closing costs are (many times) added on to the agreed upon purchase price.  You are basically financing your closing costs...but it is usually done to keep your available funds for the down payment.

7 - You will need to be employed on the same job for 2 years...or at least in the same profession.  And if you are self-employed, the lender will want to see your last 2 years tax returns...along with several months bank statements.  Most of us want to deduct everything we can on our tax returns....but remember that whatever figure you have listed on your return is the figure that the lender will have to go buy for your home affordability.

8 - It's never a good idea to co-sign with your family or friends...for anything.  Because this makes you liable for the debt and will be considered as such on your debt-to-income ratio.  Not only this - but if the person you have so-signed with doesn't pay on time, it can destroy your credit.  Don't do it!

9 - Anything legal coming up?  Any interest free loans coming due that will need to be re-financed?  Let us know about these so the lender can advise on the best way to handle it.

10 - NEVER - NEVER move any money around from one account to another.  If you absolutely must do this, be sure to do it under the direction of your loan originator.  Your "paper trail" is vital to your ability to obtain mortgage financing.  Let the lender advise you! 

 

I know this is a lot of reading - but any one item can save you a lot of heartache down the home buying road.  It's so worth the time to be prepared to purchase your new home in Nashville Real Estate.  This home buying guide is just it - only a guide.  Please let me know about any other questions or issue have.  As an Exclusive Buyer's Agent - I'm your best friend during this home purchasing time of your life.  And I look forward to hearing from you soon! 

 

 

Accent Realty Group Pam Rumley Exclusive Buyer's Agent Broker, CRS, ABR, SRES Office 615-206-8445 Direct 615-428-8500 Fax 615-206-8437 pam@pamrumley.com The agent to call when you need someone to go that extra mile!