I was reading an article this morning and it included some valuable information for potential buyers I thought I would share.

Making important decisions, like purchasing a home, is exciting! One exciting change in our lives can make it easier to make other big decisions we have been pondering in our minds here and there. Quitting a job we no longer love, buying a new car and upgrading our closets are a few that come to mind but don’t make a move until you have considered the financial backlash you could have to deal with while trying to find your perfect home. Here’s 5 financial missteps to avoid while trying to purchase a home…

1. Letting Your Credit Score Drop
Your credit score directly impacts your ability to get a home loan, the type of loan you qualify for and the interest rate. If you have borderline credit – a score in the low- to mid-600s – further credit mishaps can prevent approval. If you have credit challenges such as bankruptcy or late payments, start your house search several months earlier.

2. Languishing in Debt
Consumer debt accounts for 35 percent of your credit score. A late payment’s effect depends on the strength of your score, but the account type and the time since the last late payment also matters.

3. Shopping Sprees
Stay far away from credit-driven shopping sprees. Even paying cash for big-ticket purchases can raise red flags with a lender. They’ll check your bank statements for unusually large deposits and withdrawals and may require an explanation for them.

4. Changing Jobs
A job change may have an adverse effect on your loan approval because lenders calculate your ability to pay a home loan by averaging your past two years of income. If you can avoid interrupting stable employment during the home-buying process, that’s probably best.

5. Maxing Out Your Purchasing Power
Even though your lender qualifies you for a certain amount, only you know whether you can comfortably afford the payment. Try to stick with the price range that yields your ideal monthly payment. Looking for homes at the top of your budget limits your ability to increase your offer in a multiple-offer situation.

Hope this information helps someone get into a home they love!!

For more information and to read the complete article, visit http://abovemag.remax.com/5-financial-missteps-to-avoid-when-buying-a-home/