Know Your Limits
Don't make an offer you can’t deliver. If you win a bidding war with a check that the seller can’t cash, you have actually lost. Know the maximum monthly housing cost you can afford, and negotiate accordingly. Your maximum has to take into account not just the mortgage but also taxes, fees, and insurance. If you make an offer based only on the biggest mortgage you can get, those other costs will put you over the limit, and you might have to rescind your offer.
Related: Picking the Right Mortgage
On the Books
Be careful about committing income that a lender might doubt you have. Commissions, royalties, and earnings from self-employment—full- or part-time—that have come through for you in the past may not in the future. A skeptical lender might not let you count those types of earnings as income.
Miracle Down Payment
How, exactly, did you assemble your down payment? Money that magically materialized in your bank accounts will draw a lender’s scrutiny. You must be able to prove that any such money is a genuine gift or it might not be counted towards your home purchase.
Related: What's Up with Down Payments?
Leading a Rising Market
A Foggy Title
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