What not to do Before Applying for a Home Loan

Mortgages

You’ve seen the lists of the right things to do before purchasing your first Jacksonville home, but what are things you should avoid?

Purchasing a Jacksonville home and applying for a home loan in today’s tough, economic situation may prove to be more difficult for most individuals. It is there important to not only pay attention to the things that you should do before you apply for a home, but to examine the things you should NOT do, as well.

Avoid making any major purchases (i.e. cars). Major purchases mean more debt, and more debt means a higher debt-to-income ratio, something you simply can not afford to have when applying for a home loan.

Don’t begin moving your money around or changing accounts. Most lenders will require that you provide financial statements for at least three months for your bank accounts and statements. If you change banks or move your money into different accounts, this could raise red flags with lenders who notice large deposits and withdrawals.

Don’t change jobs. Most lenders will need to verify that you have been employed with the same employer for a period of time. Therefore, changing jobs while you are in the midst of applying for a mortgage could end up costing you a home. At the very least, if you must change jobs, it is important to stay in the same line of work. Although salaried employers are usually safe changing jobs before applying for a loan, commissioned employees should stay put until after the loan process is completed.

Do not consider self employment before purchasing a home. Most lenders will want to see at least a two-year history of self-employment before approving a home loan, so it is important to save any big changes like self employment until after you have bought your Jacksonville property.

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