Be Careful When Holiday Shopping this Season – If You Want to Buy a Chicago Home
Many of us blow our budgets during the holiday season. It’s tempting to buy that extra present for your kids or loved ones.
But overspending can be a big problem if you also want to buy a home, as a recent story in REALTOR® Magazine shows.
According to the story, those future homebuyers who splurge on holiday gifts can often rack up thousands of dollars in credit-card debt. And it’s this debt that can haunt you when it’s time to apply for the mortgage you need to buy your Chicago condominium or single-family home.
Lenders want your monthly debts, including your estimated new mortgage payment, to be no more than 43 percent of your gross monthly income. If your debt-to-income ratio is higher than that, you might struggle to find a lender willing to approve your mortgage request.
If you add thousands of dollars in holiday debt to your credit card this season, you could accidentally push your debt-to-income level past that 43 percent figure.
Think hard about whether buying those extra gifts this holiday season is worth potentially losing out on the chance to qualify for a mortgage. Remember, too, with lower debt levels, the odds are higher that you’ll qualify for a mortgage with a lower interest rate. That will equal lower monthly payments.
Applying for a mortgage can be complicated. And there are plenty of financial missteps that could complicate your efforts to nab that loan. Your best bet? Meet with an experienced mortgage lender who understands the Chicago market. This professional can guide you through the mortgage process and help you avoid any possible financial mistakes that could make qualifying more challenging.
We can recommend quality lenders to you. Give us a call if you’re looking for the right mortgage professional. Having that right professional can make all the difference.