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Highlands Ranch - Real Estate Information

Things to avoid when buying a home

When buying a house you should be well prepared. There are many more things to keep in mind than just looking at a house or area itself.

It is often recommend to be pre-approved by a mortgage lender before entering the market to buy a house. A pre-approval will already tell you for how much loan you qualify.

When a mortgage lender reviews your loan application for approval, he will be concerned about the source of funds for your down payment and the closing costs. Don't move your money around between accounts. The lender will ask for statements for each account and it has be highly visible where your available assets are. Moving money around between accounts make this a difficult tasks and lenders do not like to see money being moved around as it raises suspicion of where the money is coming from at all. The mortgage underwriter will eventually require paper trail for each and every dollar if the source of the money cannot be seen. Don't switch banks and leave your money where it is.


Do not change jobs if possible. This can especially be critical if you work in a commission-based job/industry. Lenders like to see a steady increase in income. The more stable your income history is, the better. Large fluctuations - especially when working on commission - can have a negative impact on the loan approval or the loan amount. Do not quit a job to become self-employed shortly before or during the loan approval process. That would be "committing loan approval suicide".

Stay away from any major loan-based purchase before and during the loan approval process. Additional loan payments will reduce the loan amount you would have otherwise qualified for.

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