[wpdreams_ajaxsearchlite]
Categories: Rev. Dr. Charles Butler,
Can anyone afford to buy a home in Harlem? The home values for properties in Harlem are outrageous! But what is even more distressing are the common mistakes many prospective first-time home buyers are making that will prevent them from successfully completing the closing process.
Recently, several mortgage loan officers have shared with me some horrible mistakes people have made that have caused their mortgage applications to be denied at the very end of the process.
Remember, until you have signed the closing documents and have received the keys to your property, you have not completed the process. Here are a few tips to keep in mind for the successful completion of the process: (1) Do not open any new credit accounts or make any additional large purchases until after you have closed on the purchase of your property. Lenders will pull your credit report to ensure your debt utilization is still within the accepted ratio standard. Every time you make a purchase, your debt-to-income ratio (DTI) will be adversely impacted. If your DTI exceeds 43% of your monthly gross income (GMI), you can be denied a mortgage even though your mortgage application has been previously approved.
(2) If possible, do not change jobs or vocational careers until after you have completed the purchase of your home. Most lenders want to see a minimum of 24 consecutive months of work history in the same job. If you have changed careers, you will need to establish 24 months in the new position before getting approval for your mortgage. Lenders will verify your employment throughout the application process right up to the day you are scheduled to close on the loan.
However, if you are fortunate enough to be offered another employment position paying considerably more money, it might be very difficult not to take it in today’s economy. In that case, you might seek permission from the employer to set your start date until after you close on your home.
(3) Never, ever co-sign for a friend or a relative before completing the mortgage process. By co-signing, you are assuming the debt for your friend’s purchase. If they fail to make a payment, you have guaranteed to make the missed payment. This promise to pay for your friend or family member’s debt will impact both your debt-to-income ratio and your credit score if you fail to make the payment. You have now placed your mortgage application in jeopardy of not being approved.
These mistakes would not be so detrimental except when attempting to obtain a mortgage. They can be so devastating that you can miss out altogether on purchasing your home. Do not lose sight of your goal that you have been working so hard to achieve
If you are interested in attending a Harlem Congregations For Community Improvement, Inc. (HCCI) workshop or have questions regarding the home buying process, contact Rev. Dr. Charles Butler at (212) 281 4887 ext. 231.
