Wednesday, November 5, 2014

Financial Mistakes to Avoid When Buying a Home

Purchasing a home is a large financial commitment, which means that there is no room for mistakes or regrets. Take the time to go over the following home buying mistakes and make sure that you do your best to avoid them:

Forgetting to check your credit score

Most homebuyers require the help of some form of financing to help complete their purchase. If you are one of these homebuyers, make sure you check your credit score before you apply for a mortgage. You can easily request a free copy of your credit report from Equifax or TransUnion once a year.

The earlier you request and receive your credit report, the better. In fact, many experts suggest that you request a copy of your credit report several months before you actually plan to buy. Doing so provides you the time to improve your score before applying for your mortgage.

Only paying the minimum down payment

As much as possible, try to stick to the 20% down payment “rule”. Although some sellers may be willing to let you forward a smaller down payment, you should avoid doing so. A smaller down payment means you have less equity of your home. Should an unexpected event force you to sell your home, you may have trouble doing so due to private mortgage insurance payments. Play it safe and forward a sizeable down payment.

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