Tips On How To Clean Up Your Finances!
Buying a home in Colorado Springs can be an exciting time, especially if it is your first home. Calling one of our experienced Colorado Springs real estate agents is your first step in the home buying process. Our team can assist with all questions related to the buying process from start to finish. One of the most dreaded parts of buying a home is getting approved for a home loan. In order to secure the best home loan options, our team suggests you clean up your finances before applying. Here are a few tips for cleaning up your finances before buying a Colorado Springs home.
Analyze Your DebtKnow how much you owe on ALL of your debts. if you are not sure where to start, gather all your monthly bills with a pad of paper and pen. Make a list of all debts such as amounts owed on vehicles, student loans, personal loans, or any other debts that can be paid off. Creditors will look at the amount of debt you have in comparison to the amount of income you make to determine your approval odds. We suggest you start eliminating any outstanding debt that you can, starting with the smallest amount owed. Put your new found cash towards costs needed to buy your new home. You will increase your odds of getting the best possible loan by reducing your overall debt. It may not happen overnight, but you will be glad you did it. A quick way to free up cash is to sell any items you may not need when you move. You will be able to get rid of items in your home before moving and eliminate debt at the same time.
Don't Make Any Big PurchasesPrior to buying your home, do not make any large purchases. Hold off on buying vehicles or getting additional loans unless it is absolutely necessary. You want to keep your debt down and to show stability in your credit. After you purchase your new home, you can make any purchase necessary.
Clean Up Your Credit ReportLook up your credit report and know what is on it. There are programs you can use to see your credit report for free to see what is on it. If there are any lingering accounts that need attention, call immediately and get them resolved. Past debts may show up on your report as unpaid, even when you have paid them. Paying off as much debt as you can before applying for your mortgage will improve your credit score. All creditors will pull your credit report prior to approving your home loan. Make your credit report, lender ready so you can get the best loan possible.
Pay Bills On Time
If you don't pay your bills on time, your credit score will suffer. Pay early if you can so you don't come close to showing a delinquent payment. Showing a good payment history gives lenders confidence that you can handle making your home loan payment without defaulting. If you don't know the best way to stay on top of your bills, consider setting up automatic payments through your bank or directly with the company you are paying.