3 Things not to do Before Buying a House

When preparing for a mortgage, it is essential to clean up your personal finances and get a stellar credit rating before you borrow. Besides saving money for mortgage transactions, there are other pitfalls to avoid to ensure you do not compromise your borrowing power. That said, here are things to avoid before buying a house.

Do not finance a Car or any other huge Investment.

A majority of people make this mistake often, which is why it tops the list of things you should not do before buying a house. The thought of buying a car often comes from the excitement of finally getting home and the need to upgrade your life. However, your mortgage pre-approval was based on the credit rating and debt load before purchasing a car. Adding the car debt might make it impossible to secure a new loan.

Maxing Out on Credit Card

Maxing out a credit card means you have an extra debt repayment that will be offset from your income, and as a result, you will qualify for less mortgage financing. Maxing out a credit card also lowers your credit score, increasing your loan interest. Ensure that you owe as little as possible in relation to your limit. For instance, if you have a credit limit of $5,000, you are likely to qualify for a bigger mortgage if you owe $1,000, as opposed to $4,500.

Do not Change Jobs

Consistency in holding jobs is essential in getting you a mortgage. A change in jobs further complicates the process if the terms change from salary to commission or from salary to hourly payments. Ensure to hold a job for two years or longer before buying a house.

Homeownership is a no-mean feat, especially in the now very competitive real estate market. However, observing the above rules will boost the possibility of qualifying for a mortgage, and finally, you will be a homeowner. Yourmarkham has a list of Homes for Sale Stouffville database.