When it comes to buying a West Knoxville or Farragut home, one of the most critical aspects of the process involves securing financing to purchase the home. It is essential to get approved for a mortgage prior to looking at West Knoxville or Farragut homes for sale, that way you to know how much home you can afford and you don’t wast your time looking at homes not within your price range. Applying for a mortgage involves a mountain of paperwork and feels a bit like signing your life away. In recent years, lenders have become more stringent, which is it is important you avoid a few common mistakes people make when applying for a mortgage. Read on below for three common mistakes West Knoxville and Farragut buyers could potentially make.
Mortgage Mistake #1: Taking out other loans or lines of credit while applying for a mortgage.
Why it matters: Whenever you apply for a new credit card or loan, your credit is checked. Each time your credit is checked you credit score is dinged. Dings to your credit when applying for a mortgage can make all the difference, it could increase you interest rate or even make you ineligible for the loan.
Mortgage Mistake #2: Changing jobs and not alerting your lender.
Why it matters: When you apply for a loan, what mortgages you are eligible are based on the fact that you are employed and have a stable income. Typically, lenders what to see at least two years of steady employment history.
Mortgage Mistake #3: Move major sums of money around.
Why it matters: When you apply for a loan, you’ll let them know what assets you have, this includes what in your checking and saving accounts. If you either deposit or withdraw large sums of money during the time you apply for a loan, it can offset the original asset base you gave when you applied for a loan. If moving the money around is unavoidable, be sure to let your lender know.
Mortgage Mistake #4: Keeping essential paperwork out of reach.
Why it matters: Your lender could need important documentation from your during the application process and it might be time sensitive. Be sure to keep essential paperwork, such as W-2s, bank statements, or past tax returns, within reach. That way, if the paperwork is needed you have it handy.
Mortgage Mistake #5: Make an major lease or purchase agreements.
Why it matters: Making any large purchases can increase the amount of debt you have and can offset your debt-to-income ratio. Any major changes to this can make you ineligible for the loan or increase your interestrate.
Are you thinking about buying your first West Knoxville or Farragut home? Please let us know if there is anyway that Knoxville Home Team can assist you in your home search. You can contact Rick at 865-696-9002 or via email at [email protected]. Or, you can contact Kati at 865-392-5880 or via email at [email protected]. Also, be sure to check out our West Knoxville Home Search Page to see what homes are for sale in the area.