Buying a home is an exciting milestone. If you’re preparing to purchase a property, it’s important to be aware of common obstacles that can impede a smooth closing process. Here, you’ll find solutions to a few of the most frustrating, yet avoidable, issues that could push back the closing date.
A Change in Debt to Income Ratio
Qualifying for a mortgage is a delicate balance—there are a lot of factors that go into consideration. One of the most important qualifiers is your debt to income ratio. The moment you secure a loan, be sure to keep your debt as low as possible before closing. While you’ll probably be excited to purchase furniture or other accessories for your new home, put the credit cards away so your debt to income ratio stays at an acceptable level. Even a small, negative change is a red flag for your lender, so always err on the side of caution when it comes to using a line of credit.
Late or Inadequate Down Payment
Before you can finalize the home buying process, you’ll need to have the down payment in order. While it’s usually not a problem to transfer money quickly, you never know when unexpected issues may occur. For example, it can be a nightmare if you wait until the last minute to arrange the transfer of funds, only to realize that the bank’s system is down. Instead of taking the risky route, make an effort to settle the down payment transfer a few days in advance. You can choose to bring a certified or cashier’s check to the closing, or send the payment a little earlier than necessary. Whatever you decide, keep in mind that personal checks are not acceptable.
A Change in Employment
When you’re moving to a new city or state, it’s understandable to have your eye on a new job to match. However, changing employment at any time before closing can be disastrous. Your lender wants to ensure that you’ll be able to pay reliably, and even if you upgrade to a better-paying job, it’s still a sign of unpredictability. While it’s okay to begin the job search before you move in, it’s wise to stay put until the closing is complete. Even a small change in employment could spell trouble for the transaction. For instance, even if you stay with the same company, it can hinder the closing if you switch from a salary to an hourly or commission-based payment. If you’ve just received an offer that you can’t turn down, be sure to communicate with your lender as early as possible—it may not affect you if at least one month’s worth of pay stubs can be provided.
When you’re ready to begin the home buying process, be sure to work with a qualified agent. Our team is here to help you find your dream home, and we’d love to hear from you. To start the process, give us a call or send a message online.