Timelines for Mortgage Milestones
Sometimes the timeline of buying a house with a mortgage can be confusing. Here are a few questions I get frequently, and how I answer them!
Do I need to have my downpayment and closing costs at the start or end of buying my home?
Many people worry about when they need to have their money for closing – whether they are saving it up, getting a gift from family, need to sell their home, or are trying to time the market on selling stocks. Other than the upfront money you’ll need (like earnest money, inspection fees, and appraisal fees), the rest of what you owe isn’t needed until you’re ready to close on the home.
Closing usually takes place about 30 days after your offer is accepted by the seller, so you have some time before you need to provide any financial proof. Just make sure your lender knows where and when you’re getting the funds for closing, so that there aren’t any last-minute surprises that could delay your closing!
Should I pay off my debt before getting a mortgage?
My answer may be surprising to you: no! Don’t pay off your debt before getting a mortgage. Many people think you need to have your financial house in order before getting preapproved, or that you need to have all your money saved, all your debt paid off, and be in your “forever” job. Luckily, you don’t need these things!
When you work with an experienced lender, we compare what you want to buy against what you qualify for. If those two don’t line up, we’ll make recommendations of changes you can make – like paying off debt.
However, sometimes paying off debt isn’t the answer at all to getting your loan approved! It may be better to keep it in savings as extra reserves or pay off some debt in a strategic way to help increase your credit score.
When you start your homebuying planning with the help of a lender early, you can lower your costs...and your stress level!
How can I buy a home before starting a new job?
So, you’ve got a great job in an awesome city. Congratulations! But how can you buy a home before reporting for your first day?
Here’s how: For most loan types, you can qualify on future employment if the following applies:
The start date is within 60-90 days (but it can be longer in some cases)
The employer is not a family member (or someone involved in the transaction)
The job is salaried, and can’t fluctuate (like hourly earnings or based on commission)
So yes, it’s possible, but not always simple. If you’re trying to buy your home before you start a new job, just make sure you’re taking advice from the right people.
Thinking about buying a home before you start your new job, or have any other questions about the mortgage process timeline? Reach out – I'm here to help make the homebuying process clear and drama-free.