The first thing you should be thinking about when buying a home is securing your first mortgage. If consumers have learned anything from the financial crisis that began in 2008, its that mortgages are not free. While the banks were largely at fault, consumers also have to accept some responsibility for the fact they took out home loans they could not afford. The initial payments seemed doable to many consumers but eventually those initial rates give way to higher payments and many home owners who had achieved the American dream then found themselves in foreclosure. A mistake like this can set your finances back a decade or more. Here are a couple of things to work towards in securing that first mortgage.
1.) Get Your Credit In Order- There is nothing that makes more financial sense than straightening out your credit report prior to applying for a mortgage. Unfortunatley, too many of us enjoy our youth with lavish spending and no savings. While some of us make good money in our lates teens and early 20′s, working lots of hours before being tied down with kids, we still use credit cards too and the balances just accrue over the years. Get a free credit report from the major reporting bureaus and pay down those balances with poor interest rates.
2.) Make Sure You Have Been At Your Current Job At Least A Half Year- A job change could effect the amount of your first home mortgage. Indeed, you need to be at your current job at least 6 months before the income can be factored into your mortgage package. If you’re just starting a new career or your partner has a new job, wait a little bit longer until applying for the mortgage. That way your debt to credit ratio improves and you can secure a better interest rate.