In the past few years the housing market has become difficult and most especially for Home Buyers. Unfortunately Buyers do not always realize the implications of some of their decisions and the impact it could have on the financial picture when it comes time to go to the bank and get your financing arranged. It isn’t a nice surprise to find out you can’t get as much of a mortgage as you thought or even worse, no mortgage at all.
Contributing to this article is my local Mortgage Broker Kellie Bonnici. She can be reached at 705-927-3560. She has been a great resource to me with the designing of the new Smart Home Buyer Plan for Buyers – giving Buyers the best resources and every advantage when buying a home, as well as saving money.
1 – Change jobs, become self-employed or quit your job
2 – Buy a car, truck, snowmobile, boat, motorcycle or van – unless you are going to live in the van
3 – Use credit cards excessively or let current account fall behind
4 – Spend money you have put aside for closing costs
5 – Omit debts, liabilities or loans from your loan application
6 – Buy furniture, appliances or big ticket electronics before you move into your house
7- Originate any inquiries into your credit – from any other parties but your Lender (hurts your credit score)
8 – Make large or cash deposits without checking with your Mortgage Broker or Lender.
9 – Change bank accounts or close accounts you have had for a long period of time
10- Co-sign a loan for ANYONE, or anything – loan anyone money
The list above is pertaining largely to those who want to buy a house in the next 12 months (24 if they’ve changed jobs). Those are the ten issues that crop up the most often and affect a Buyers ability to get approved for a mortgage or the amount they can get.
Keep in mind – you find a house, make an offer, its accepted and Yayyyyy!
However, any financing that you require is based on your financial situation at the time the mortgage is approved. In other words, when the Lender says you are approved and can waive the financing condition in your offer – it is approved on your financial situation AT THAT TIME. This includes the amount in your savings and other bank accounts, credit card debt, credit report, loans or any other financial obligation. Just prior to the closing date, the Lender will take another look at your financial situation to ensure nothing has changed. So, its important to be aware of this and not change your financial picture before the closing date.
Once you are approved for the mortgage, You CANNOT spend any large amount of money , apply for loans, purchase a car etc., until after the sale has closed and you have moved into your new house. Then go crazy!
Many people have made the mistake of thinking that since they were approved and the bank accepted the agreement and approved it, then all is good. However, banks and lenders do a final quick credit check on a Buyer, just before the closing date and unfortunately there are some not so nice surprises and sometimes scrambling right before a closing
If you are planning your future and on track to save money towards your first home, or looking to pay your mortgage faster so you don’t give the bank more money than you need to, get in touch and we can offer some great methods to save faster and pay your mortgage down quicker. A few quick and painless changes and you could save thousands in interest.
Reach out anytime – we are always here to help!
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Real Estate Smarts
Christine Domina
249-444-3212
Peterborough County &
Surrounding Areas
130 King St W Ste 1900
Toronto ON M5X 1E3
