Well, we are now into 2020 and if this is the year you're planning on buying a home there are things you can be doing now to set yourself up for homebuying success. Call it New Year's resolutions, call it a goal, whatever, these things need to be considered if you plan on purchasing a home in 2020.
#1. Stay with your job.
Job history and your income are key elements in determining your reliability for paying a loan back so lenders look at your job stability and history to determine how likely it is you'll stay with the same income, get promoted, and be able to pay your bills. You can get promoted within the same business but quitting a job completely or getting fired and that having to reapply for a new job does not look good for lenders. However, if you're moving from a commissioned or hourly job to one that salary with more compensation, it may actually help your application.
#2. Consistent monthly bills.
Monthly subscriptions these days can certainly add up. I feel like we're making monthly payments for just about everything including our razors and leggings. But even if you pay off your credit card every month, these high credit utilization of your credit report that gets monitored all the time can be hurting your score. Consider keeping monthly subscriptions to a minimum.
#3. Build that credit score.
Your credit history and score is one of the number one things lenders look at when determining your risk. Lenders prefer borrowers who have a history of paying off credit cards and other debts, especially on time. If you have too much debt or too high of debt, it may alter your debt to income ratio. Lenders want to make sure that you have enough money each month to make your debts without incurring hardships, especially if you're going to take on a housing payment.
#4. Get a copy of your credit history.
Just bite the bullet and do it. You need to see what lenders will be seeing. If there are errors or mistakes make sure you correct it before applying for a home loan. If there is an error that cannot be corrected, make sure you have a letter of explanation ready to go.
#5. Avoid any large purchases.
Don't take any more debt on before applying for a home loan but this also means not making any large payments or purchases as well. Lenders want to see that you have reserve funds in case you lose your job and still need to make your mortgage payment.
Feel free to check out my finance section for all tips and information for those buying or borrowing. And don't forget, whether you're buying or selling in 2020 throughout the Portland real estate market give us a call.