When you navigate the process of buying a home, the end goal is to have your mortgage close and to take possession of the home. The time between negotiation and taking possession of the home can often leave plenty of room for financial decisions and uncertainty. If you have a closing date that is a month away, it is critical to keep your finances on track and avoid making any costly financial mistakes.
We wanted to cover some of the top mistakes that Toronto homebuyers make before their mortgage closes.
1. Don't make any large purchases
One of the biggest mistakes you could face before your mortgage closes is to take on new debt or make large purchases. It might be tempting to treat yourself after all the hard work put into buying a home, remember that your mortgage payments are due soon, and adding more monthly expenses could increase the strain of getting your finances in order.
2. Don't change your employment situation
In addition to big purchases, it is also important not to make any changes to your employment status or income while you are waiting for your mortgage to close. This includes changing jobs, getting a raise or promotion, or taking on freelance work.
Any changes in your financial situation could affect your ability to secure a mortgage or make it more difficult to close on time.
3. Don't neglect your savings and investments
4. Don't use your credit cards excessively
Buying a new home comes with expenses, fees for lawyers, new furniture, renovations to sell your previous home or meet the conditions of your new home buyer. For Toronto home buyers who live in the city, debt can quickly eat up existing savings and cause you to take on new debt.
To avoid this, be sure to use your credit cards sparingly and pay them off as soon as possible. You should also limit your expenses outside of necessities such as groceries and transportation so that you can manage any unexpected.
5. Stay on top of deadlines
Closing on a mortgage is a time-sensitive process. Submitting all paperwork on time will ensure you can keep your rate. We recommend that Toronto home buyers start preparing for closing at least 6 months in advance. This includes ordering mortgage approval documents, meeting with a mortgage broker in Toronto and speaking with your lender to get details on what will be needed at closing. By staying on top of deadlines, you can ensure that your Toronto mortgage closes without any additional stress or financial burden.
Making any of these mistakes before your mortgage closes could jeopardize the success of your home purchase. Be sure to contact your mortgage broker about any concerns or questions that you have to avoid making a costly mistake.
