Sigh, it’s happened yet again. Somehow no matter how much counseling, another Buyer’s forgotten one of the golden rules of buying a house: If you spend money on credit cards, buy a new major appliance on credit, buy a new car, decided to furnish your new home before closing … you run the risk of not qualifying for your loan. Even if you qualified before you ever started shopping.
There’s nothing more disheartening to find the home of your dreams, go through all the steps … qualify and be preapproved for your loan, inspection, title searches, negotiations, etc., … and then find out just before closing that, yes, the underwriter reviewed that last credit report only to find an additional new monthly payments
OH NO! There’s a new credit line that blows the debt to income ratios totally apart.
Yes, sometimes life gets in the way of judicious decisious during the period of time between making application for a home loan and closing. And some Buyers have sufficient income and are shopping far enough below their top qualifying number to sustain an extra monthly payment, but typically not.
Not only are your credit scores, credit history, and monthly debts examined at the time application is made, they’re checked again right before closing to be sure no significant changes have occurred. Qualifying for a mortgage is difficult right now. Hang on just a few more weeks. Wait until after closing.