Home buying: Protecting your finances
For most of us, purchasing a property means more exposure to financial and/or legal transactions than we would encounter on a normal day to day basis. Below, you will find a few key tips to help you make financially savvy decisions through your home buying process.
Your credit report is a valuable document when it comes to purchasing a home. Before approving your request for a home loan, First Tech will review your credit report.
Under federal law, you have the right to obtain a free copy of your credit report from each of the consumer reporting agencies once a year. Visit www.annualcreditreport.com for additional information.
Your credit report is a summary of your credit history. It lists:
- Identifying information: your name, address, Social Security number, date of birth and employment information used to identify you
- Trade lines: current and historical credit accounts, including the type of account (mortgage, credit cards, auto loans, student loans, department store cards, etc.)
- Public record and collections: bankruptcies, foreclosures, suits, wage garnishment, liens and collections activities
- Credit inquiries:this section contains a list of everyone who accessed your credit report over the last two years.
You have a right to dispute any inaccurate information in your credit report. If you find mistakes on your credit report, contact the consumer reporting agency. Please visit Equifax, Experian, and Transunion. For more information about credit reports and your rights under federal law, visit the Consumer Financial Protection Bureau's website at www.consumerfinance.gov/learnmore.
If an offer sounds too good to be true, it probably is. Be skeptical if someone suggests that your credit problems won’t impact the interest rate. Get any offers of credit in writing and seek a second opinion from a trusted professional.
Don’t take on additional debt
Your pre-approval is based upon your situation at the time you go through the pre-approval process. Part of the criteria used for the mortgage is how much debt you have at the time of your application. Even a small change in your debt and credit score can change your pre-approval status. If you go and buy a new car, get a new credit card or even increase the amount owed on your current credit card, this may delay or affect your ability to close your mortgage loan.
Be sure documents are correct
Never falsify information or sign documents that have information that is incorrect. Don’t sign a document unless all of the information required is filled in. If you see incorrect dates or blank fields, or someone suggests they will “fix it/fill it in later,” insist that corrections be made before you sign.
Find out about fees
Make sure you completely understand all costs associated with your mortgage. Request written estimates that list out all points and fees. If you are looking at two options, make sure you’re comparing apples to apples and if at any point something doesn’t look right, ask.
If you have any questions at all—about any document or part of the process—please reach out to your First Tech loan officer.