When people are buying a house, selling another house or making a major move, they usually tend to have unusual expenses, which in Sean La Rue Home Loans we do not recommend. Let’s see why in this article!
These people may normally spend only a few hundred dollars a month on their credit cards, perhaps even paying it off by the end of every billing cycle. However, when their credit score needs to look its best, they start to spend much more than a few hundred with their credit cards on furniture, moving expenses, home repairs,etc..
Some find it very unfair when their lender tells them that they have a high debt ratio on their credit story, but what we need to keep in mind is that the balance is reported at a specific time, so even if we pay off our debt every month, our credit score may be highly affected if we just spent some thousands all of a sudden for our new home.
What’s our piece of advice?
The common mistake is to think that once the credit reports have been pulled out, we can start spending on stuff for our future home because what’s the matter of buying furniture before closing on a property? Well, let me tell you It is actually a big matter, as it can make a big difference that can result in you losing the house of your dreams.
In Sean La Rue Home Loans we can tell you that when you are in the final stages of getting a mortgage, it’s a good idea to stop using your credit cards, or at least cut way back on credit card spending. Pick out the furniture, but don’t buy it yet. If you do buy a large item, consider paying down your card immediately online, so you’re not caught with a high balance just on the day your bank reports to the credit bureaus.
Good luck, and I hope you enjoy your new home for many years to come.
So that’s all for today, hope you found this article useful so far and don’t hesitate in reaching me out if you have any questions or need a consultation.