Nothing is more exciting than taking your first step towards home ownership. You can’t wait to end your renting life, and start paying for something you could actually own someday. Considering the number of housing options in Utah, the property hunt gets even more thrilling.
Unless you’re well heeled enough to buy your first-ever home cash, you must be more careful with your actions. Believe it or not, your decision-making right from the start might define the quality Provo, Sandy, or Salt Lake City mortgage you could get. Altius Mortgage Group and other lending companies noted that doing the following are how not to play your cards right:
Forgoing Pre-Approval
You must know how much you can afford before you shop around. No matter how fun it is to check each property for sale and imagine your family living in it, you might be wasting time if you find out you’re not qualified to receive the necessary funds to buy it.
A pre-approval allows you get an assurance from a lender that you’re approved for a particular mortgage. You would have to provide proper documentation of your credentials to see how much you can qualify for. Although the amount quoted to you isn’t final, a pre-approval gives you an exact amount how much a lender would be willing to loan you.
Swiping Your Card for Big Purchases
As your debt-to-income ratio is important to your mortgage approval, incurring large charges on your credit cards might sabotage your chances of getting approved. Even if you have good credit, a big purchase could seriously decrease your credit score by more than 10 points. Any damage to your credit might suffice to disqualify you for a number of desirable mortgage rates.
Forgetting to Establish Your Credit History
Your past is as important as your present financial situation. Lenders are smart enough not to depend on your flawless credit now. You must have a minimum of three credit accounts with a history of two years on each. The more information you can provide about your repayment behavior, then more confident the lender can make an intelligent decision about your approval.
Applying for a mortgage is no laughing matter. You must never take anything about it lightly, or else you’re bound to make regrets later on.
