In recent years, more people are showing a keen interest in buying their own home, and demand for housing is almost reaching its peak. When it comes to real estate properties, the majority of homebuyers prefer new homes over existing ones, according to surveys. Recent numbers from the National Association of Home Builders Preferences Survey further revealed that 65 percent of these buyers prefer homes in a suburb.
Areas like Gulf Shores, AL are filled with available homes for sale within quaint and peaceful suburbs. Before you immerse yourself in checking listing after listing, ask yourself first: are you ready to buy your first home? After all, this is one of the biggest investments you’ll make in your life. You must be financially prepared months before you apply for a mortgage.
Unfortunately, certain habits, though seemingly harmless, might actually jeopardize your plans of buying a home.
Being too reliant on your credit cards
It’s been said time and again that prudent use of your credit cards can make all the difference, especially if you’re planning on buying a home. Following a “buy now, pay later” attitude not only causes financial problems, but can also affect your prospects of getting approved for a mortgage.
Real estate experts recommend future homebuyers to use no more than 30% of their available credit. Otherwise, they might risk causing a dent on their credit score. Reducing your credit card debt can work to your advantage, as it makes you more attractive in the eyes of lenders.
Ignoring your credit score
Lenders use your credit score to determine whether to approve your mortgage application or not. Though the minimum credit score varies depending on the lender, most popular loan programs often require scores of 620 or higher to be eligible. Keep in mind that your payment history, the amounts owed on each account, and newly opened lines of credit are just some of the factors that affect your credit score.
Late credit card payments
Contrary to popular belief, making your credit card payments late can have a negative impact on your credit score. Even more detrimental is completely missing even a single payment. Remember that a low credit score would translate to expensive loans, and can even cause your mortgage application to be denied.
By implementing better habits in place of these bad ones, you’ll be financially ready for that big purchase. After getting pre-approved for a mortgage, begin your search for the perfect home with the help of exclusive buyer’s agents like Malcolm Bond, THE Buyer’s Agent. Malcolm serves buyers in all of the areas surround Gulf Shores, Orange Beach and Perdido Key. Call him today for a free, no-obligation consultation. 1-866-981-4378.