If you are in the market for a new home there are a few things that you should definitely not do before hand. One of the biggest things that you should not do is make any major purchases such as cars, furniture, vacations, or any other expensive items.
There are several reasons you should keep track of your spending and try to limit it if possible. If your like most you will need the assistance of a home loan to be able to afford the new house that you have been dreaming of. If this is the case then being pre-qualified can be crucial. Everything that is on your record including debts and income will be needed for your application.
The amount of income that you have, along with any type of savings will be calculated into what amount you will be eligible for if at all. If you have recently purchased an expensive product or item that you are paying monthly on this can play a huge factor in the outcome of the qualification process. Outstanding balances or debts can cause you to be approved for a much lower home loan than if you had applied with no debts at all. A lender will be more open to approving your desired amount if you are able to provide a stable income with the ability to make your loan payments without possible error.
While you may want to purchase things like furniture or decor for the new home you plan on purchasing or even a second car to simplify your busy life it would be a wise decision to halt all excessive spending until after the approval of your new home loan. This ensures that you get the amount that you need to purchase a house that will be what you need and will accommodate you for years to come. You don't want to compromise on your choices if you don't have too.
Searching for the right home in the perfect place? Chances are you'll want to check here first.
Gary Allalouf- RA
Hawaii Realty International
Hawaii Mortgage Basics