Thinking of buying a home this year?
Check out these five New Year’s resolutions that can help you in the process.
Avoid Job Hopping
Employment history and income are two of the biggest factors lenders look at when evaluating a mortgage application. A new job may be a good career move, but if you plan to buy a home in the new year, know that job hopping can be a red flag to some underwriters — especially if you’re moving to a different industry.
Limit Monthly Subscription Services
Monthly subscription services are certainly convenient, but they can add up. Even if you pay off your credit card every month, you could be dinged for high credit utilization if your credit report is pulled mid-cycle.
Build a Solid Credit History
One of the first things a lender will look at is your credit history. Lenders prefer borrowers who have a history of paying off credits cards and other debts on time — because it signals that you’re a responsible borrower and less of a risk.
Check Your Credit
Your credit score can have a significant impact on your ability to buy a home. A low credit score can negatively affect how much money a lender is willing to loan you, as well as your interest rate.
Avoid Large Purchases
Avoid taking on large amounts of debt — whether it’s buying a car or planning a large vacation — before buying a house. This is advisable even if you’re already pre-approved. Your debt-to-income ratio, or how much money you make compared to how much debt you have, can significantly affect how much money a lender is willing to give you. Keeping debts to a minimum can help make the home-buying process go a lot more smoothly.
Just like proofreading your resume before you apply for a job, cleaning up your financial resume can help improve your chances of buying a home.
Have more questions? Reach out to one of our mortgage specialist today at 860.426.2447
Ready to get pre-qualified? Fill out our pre-qualification form today.
* New Year's Resolution Tips Curtesy of Zillow.com