How to Avoid Common Home Purchase Roadblocks

When you decide that it’s time to dive in and make your first home purchase in Cinnaminson, New Jersey you should know that there are roadblocks that can occur. These roadblocks aren’t always dealbreakers. They can be avoided, and fixed if they do stall the transaction so that you and your family can purchase the home of your dreams and move in as soon as possible.

Failing to Save for the Down Payment

Rarely does someone buy a home without making a down payment. Most down payments are in the $20,000 range, which is a large lump of cash, especially for a young couple just getting started. If you haven’t been saving for the down payment this could very well put a damper on your purchase of the home. If you are being gifted the money from a family member you need to get it in writing that this will not be a loan that has to be repaid.

In order to avoid this roadblock, you need to start saving right now. If your goal is to own a home in the next 10 years you need to start putting money away now. You should also put aside money for the closing costs, which can be anywhere from two to three percent of the home’s purchase price.

Not Getting Pre-Approved

Many first-time homebuyers in Burlington County make the mistake of getting pre-qualified instead of pre-approved. Getting pre-qualified is the simpler of the two and only involves you having a light conversation about your finances with the lender.

You need to get pre-approved if you want to avoid roadblocks to buying a home. This is when the lender runs your credit report and determines if you have enough income to cover a mortgage.

Making a Wrong Offer

It’s not uncommon for homebuyers to make the wrong offer, especially if they are not working with a realtor or attorney. You need to work with an expert in the real estate market who can research comparables and other information about the homes in which you are interested.

Your offer needs to take into account the days the home has been on the market, the comparable listings, if the asking price is in your budget and more. Consult with your real estate attorney to find out if offering above the asking price is in your best interest.

Making a Separate Large Purchase

If you are in the middle of house hunting you should avoid making any other large purchases using your credit card. This includes a boat, a car, appliances, art or anything else that would have a high price tag.

If you absolutely must make another large purchase while trying to buy a home you should wait until the day following the closing appointment. This is if you want to use your credit to make the purchase. If you can pay for the purchase in cash.

Each time you apply for credit your credit report is updated. Applying for a new credit line, or adding a balance to your report, can greatly affect the ability to acquire a mortgage.

Contact the office of Ms. Trish Davis, Esquire in Cinnaminson to discuss your plans to buy a home in New Jersey. Ms. Davis can be reached at 856-829-9204.