My mother-in-law sold Real Estate long before I ever did and she had a story about a young man who put an offer on a house, got pre-qualified for the loan and then two weeks before he was suppose to close on his new home purchased a new car! This put his debt ratios out of wack and then he no longer qualified for his home loan. He actually sold his new car and could then close on his house, but it still happens today!
Don't make the same mistake. Do not buy anything on credit and / or with a credit card once you have completed a loan application. Do NOT buy:
· Automobiles
· Washers, dryers, refrigerators
· Lawnmowers or garden equipment
· Expensive electronics or computers
· Furniture for your new home
Slight alterations in your credit ratios could cause an underwriter to throw out your loan and deny it. If your loan contingency has expired or been removed, you could forfeit your earnest money deposit in addition to losing the home.
When I find the home I want, how much should I offer?
Answer: Again, your real estate broker can help you here. But there are several things you should consider: 1) is the asking price in line with prices of similar homes in the area? 2) Is the home in good condition or will you have to spend a substantial amount of money making it the way you want it? You probably want to get a professional home inspection before you make your offer. Your real estate broker can help you arrange one. 3) How long has the home been on the market? If it's been for sale for awhile, the seller may be more eager to accept a lower offer. 4) How much mortgage will be required? Make sure you really can afford whatever offer you make. 5) How much do you really want the home? The closer you are to the asking price, the more likely your offer will be accepted. In some cases, you may even want to offer more than the asking price, if you know you are competing with others for the house.