10 Commandments of Real Estate

If you’re considering purchasing a home, it’s likely you’ve already taken a good hard look at your credit history. It’s important that you do so because a loan officer is going to look at your history and your credit score to determine not only your financial worthiness when it comes to buying a home, but also how much money you should be able to borrow for your new home.

If you are working with a lender or a real estate agent, they will tell you things that you can do to better your credit and things you should do during the lending process so you don’t kill your chances of a new home loan.

When it comes to preparing for a home loan there are 10 commandments that you need to follow to ensure that you get the best loan to purchase your future home.

  1. Keep your job! Do not change jobs, do not become self-employed, and certainly avoid quitting your job. You need to have a good employment history of at least 2 years and sometimes more if you’re self-employed.
  1. Do not buy a car or truck. This is considered a major purchase and should definitely be avoided until you’ve closed on your mortgage.
  1. Pay attention to your credit. Don’t charge any big purchases and don’t spend too frequently. Also make sure that all of your credit cards are paid on time.
  1. Make sure that you have money set aside for the closing of your future home and that you don’t touch that money until it’s time to close.
  1. Make sure that you list all of your debts on your loan application. Leaving something out that the lender finds out about later will make it harder for you to get a loan.
  1. Do not change bank accounts. It looks better if you keep things stable and that includes things like keeping the same job and using the same bank account.
  1. Do not buy things like furniture or appliances and if you do, do not buy them with credit.
  1. Do not originate inquiries into your credit. This means you should avoid applying for new credit or for additional money from your creditors.
  1. Avoid making large or out of the ordinary deposits into your bank account without the approval of your loan officer. Usually, this won’t be a big problem when you’re going to purchase a new home, but you’re better off checking with your loan officer before taking it for granted and depositing a large amount.
  1. One of the most important rules on this list is to never co-sign for a loan for anyone. You should never co-sign unless you’re willing to bet your good credit on someone else. Even if you’re comfortable doing that, you should definitely avoid co-signing when your attempting to get a home loan. You need to build the best credit score possible, and you can’t do that when you’re signing for someone else’s loan.

Preparing to buy a home doesn’t have to be a difficult process. As long as you ensure that you follow these 10 commandments, you will be well on your way to owning your new home.

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