Before you buy a home, it is important to get all your ducks in a row. The Lawhead Team would like to share what not to do when buying a home.

•  Keep your bank account steady when buying a home. Don’t make large deposits into your bank account. Lenders usually like the money you’ll be using as your down payment to be sitting in your account for at least two months prior to approval of a loan.
• Don’t change your bank. Just like your employment, it looks better if you have been with one employer for a longer period of time when buying a home.
• Keep your job, don’t change it. Just like above, you want to show your lender you have stability. This is not the right time to become self-employed or go on unemployment.
• Don’t purchase anything you have to finance. Buying a truck or car will increase your debt to income ratio and loan officers do not like to see that. Wait until after your loan closes to purchase a new vehicle when buying a home.
• Wait until after you close escrow on your house to buy furniture on credit. Just as above, you want to avoid a larger debt to income ratio.
• Don’t be late on your payments you currently have. For example, being late on a credit card payment shows you have a hard time managing your money.
• Make sure to be honest on your loan application. Don’t leave any debts or liabilities out on your application when buying a home.
• Always avoid co-signing for someone on any type of loan. This not only increases your debt to income ratio but if the other person fails to make a payment, you are responsible for that payment.
• Don’t have hard inquiries made on your credit. Opening credit accounts within a short period of time represent risk and your credit usually takes a hit. When buying a home, you want to do everything to make your credit the best it can be.

If you have any questions about applying for a home loan, please call The Lawhead Team, Because Two Lawheads Are Better Than One!